This article is from the Australian Property Journal archive
BOOKSTORE chain Dymocks Group has emerged as the buyer of an office building at 441 St Kilda Rd for $86.6 million, and it is on the lookout for more property investments.
The sale price reflects a yield of 7.41% and the property was sold by Centuria, which bought it two years ago for $58 million.
Dymocks Properties’ managing director Cathy Tiberio said the group had been looking for sensibly priced major property investments for some time following the sale of 34 Hunter St in Sydney CBD and 66 Kings Park Rd in West Perth.
“The Dymocks group owns a number of office, rural and industrial properties across Australia including the iconic Dymocks Building at 424-428 George St Sydney.
“441 St Kilda Rd continues our diversity of locations and we will now put energy in to finding assets in Brisbane, the Gold Coast and Southport,” Tiberio said.
441 St Kilda is a seven-level A-grade office building comprising 16,128 sqm of net lettable area including ground floor retail and offices, five upper levels each comprising 3,200 sqm of NLA office accommodation and 334 car-parking bays, set on a land area of 6,070 sqm.
This latest acquisition shows demand for commercial property in Melbourne continues to go from strength to strength.
Knight Frank’s Victorian managing director James Templeton said the 2014 calendar year is set for another bumper record with the total amount of commercial sales to date already surpassing 2013.
According to Knight Frank, over $4.6 billion of properties worth of office, retail and industrial properties have changed this year outstripping the $3.9 billion recorded in the same period in 2013.
Both the office and industrial markets saw an increase in sales with $2 billion injected into the CBD office market compared to $1.75 billion over the first three quarters of 2013.
There was a total of $846 million invested in the St Kilda Rd, Southbank and suburban office markets compared to $503 million over the same period in 2013.
Industrial sales rose from $340 million to $576 million. The retail sector fell with $1.2 billion spent so far this year compared to $1.3 billion on the previous year.
Knight Frank Australian head of commercial sales Paul Henley said while offshore buyers retained their interest in office assets, unlisted funds and syndicates dominated the office sales in 2014 to date, accounting for 63% of non-CBD office sales, spending $533 million and accounting for 38% of CBD office stock with transactions totalling $769 million.
“Offshore buyers are still big buyers of Melbourne commercial property acquiring a total of $1.2 billion in property this year just down slightly on the $1.4 billion in purchases over the same period of 2013,” he added.
Templeton said unlisted funds and syndicates have been the most active buyers making up for $1.66 billion of the total or about 36% while the share of properties sold to offshore groups fell from 36% in the first nine months of 2013 to 26% of 2014 to date.
“Unlisted funds and syndicates also invested heavily in the industrial sector with $318 million spent accounting for 55% of the total transactions this year while AREITs have also increased their spending in the sector with $127 million spent, accounting for 22% of the total, up from $39 million spent over the same period of 2013.
Australian Property Journal
