This article is from the Australian Property Journal archive
LEIGHTON and Qualitas have sold their Moonee Ponds site to Joe Russo's Caydon Properties, at double the price they paid 18 months ago, in one of the largest suburban development site sales for five years.
Located at 40 Hall St and 34-36 Margaret St in the heart of Moonee Ponds, 4km north of the CBD, the former Readings site of 13,400 sqm has a concept plan for a $650 million, multi-staged development comprising approximately 1,200 apartments in additional to retail and office space.
The site is currently leased by Carepark.
The price was not disclosed, however industry sources pointed to a price in excess of $45 million. If that is the case, the price has delivered a huge windfall for Leighton and Qualitas, who bought in October 2013 for $23 million. The land is zoned Commercial 1, which allows for mixed use. A development plan overlay is presently with the Victorian government for approval.
The sale is further evidence of investors and developers insatiable appetite for development sites in the city fringe and inner city suburbs. Last week, Singapore`s Chip Eng Seng sold a vacant development site at 170 Victoria St Melbourne for $64.8 million, after buying it two years ago for $32 million.
CBRE negotiated the sale in conjunction with JLL.
CBRE`s director Mark Wizel said this transaction caps off a busy week for the agency`s City Sales team, who have brokered eight deals in the past nine days, valued in excess of $96 million.
“The sale is a clear demonstration of the confidence that local developers have in the residential apartment market within 10km of the Melbourne CBD.
“Given the scale of the site, and the proposed concept plan, buyer interest had centred on the potential to develop the asset as a new mini suburb,” he added.
Caydon Principal Joe Russo said the company intends to revitalise the under-utilised site and create a destination hub, complete with retail and office space.
“The acquisition fits with Caydon’s strategy to develop inner city neighbourhoods where people can live, work and socialise close to public transport, retail amenity and parklands.
“The site benefits from its proximity to a thriving eclectic retail strip, being Puckle St, in addition to two major shopping centres. Most importantly, the train station opposite the site means that no apartment will be further than 200 metres from public transport,” Russo said.
Wizel said the sale had been finalised amid a significant shift in the Melbourne housing market, which was underpinning the current strength in the suburban residential development site market.
“We are seeing a growing shift towards apartment living in the face of rising house prices, which is providing opportunities for the local property and building industry.
“Whilst Asian led consortiums continue to dominate the skylines of the Melbourne CBD, it has been a handful of strong local developers such as Caydon that have led the way in the suburbs to satisfy the current buyer demand,” he continued.
Caydon is one of the most active non-CBD residential developers post the GFC with major projects in Prahran, Hawthorn, St Kilda and Brunswick.
In December last year, Caydon snapped up the 11,340 sqm Richmond Malt site, home to the Nylex clock, from Richard Mizgala of Power Investments for $38 million and has plans to develop a $600 million mixed-use project.
“We now control well over 3.5 acres across this site and are working very hard behind the scenes to design something that is distinctive for that location and of a quality that has never seen before in Melbourne,” Russo said.
Caydon is expected to announce plans for the Moonee Ponds site in the coming weeks.
Australian Property Journal
