This article is from the Australian Property Journal archive
MELBOURNE CBD’s busy restaurant thoroughfare Flinders Lane has seen a third building change hands this year, with the home of Chris Lucas’ Kisume selling for about $25 million to a local private investment group.
The buyer picked up 175 Flinders Lane from philanthropist Helen Sykes – wife of former AFL commissioner Mike Fitzpatrick – on a sharp yield of 2.5%.
It had been put to the market in May with expectations of around $20 million.
Sykes had paid $9.8 million for the building in 2015, while some $5 million was spent refurbishing Kisume.
As well as trendy restaurants and bars, Flinders Lane has also become a city hotspot for commercial building deals. Invicta House, at 226 Flinders Lane, sold for close to $40 million earlier this year to Swiss fund manager Fidinam. Swinburne University had bought it for $44 million in 2019 before needing to release capital as the pandemic smashed tertiary education providers.
Further west, Sydney-based pub tsar Justin Hemmes made his first Melbourne purchase for his Merivale Group with the $40 million acquisition of Tomasetti House at 277-279 Flinders Lane for a new venue.
Colliers’ Daniel Wolman, Oliver Hay and Leon Man and Killen Thomas’ John Camilleri brokered the 175 Flinders Lane following an international expressions of interest campaign that Wolman said generated a strong level of demand and enquiry, primarily drawing interest from local and offshore high-net-worth private investors.
“Lack of quality stock and opportunities in the market is creating pent-up demand and competition between buyers, a testament to the true strength and confidence in the Melbourne CBD market.
”Rising capital value rates and compressing yields is becoming a common trend, particularly at this price point. A supply starved market will continue to push pricing.”
Kisume occupies the lower levels of the eight-level building, which provides boutique office accommodation above the venue.
“The building is also strata-subdivided on a floor-by-floor basis, which was a key attraction for buyers looking for a potential future strata sell-down play,” Camilleri said.
Colliers, with Allard Shelton, are marketing the historic Nicholas Building at 37 Swanston Street, at the corner of Flinders Lane. More than $80 million is anticipated.
