This article is from the Australian Property Journal archive
ABBOTSFORD’S former Kodak building and Carlton & United Breweries headquarters are set to be utilised as a self-storage facility, after selling for $19 million.
The 2-6 Southampton Crescent, 36 Bond Street and 27-29 Duke Street property spans 3,099sqm, sit opposite Carlton & United Breweries’ famous Yarra River brewery, around 2km north-east of the Melbourne CBD.
Paul Burns and Chris James from Fitzroys sold the property on behalf of developer Hengyi, in an unconditional contract of sale to a self-storage operator, Howzit My China Pty Ltd.
“Changes in living and working preferences accelerated by the pandemic have prompted consistent increases in fee rates and revenue growth in self-storage facilities in recent years. Listed and private self-storage players continue to record strong sets of numbers amid an ongoing imbalance between supply and demand,” said Burns.
“Abbotsford and the surrounding inner-Melbourne suburbs have a large and growing number of medium and high-density dwellings that are conducive to requiring self-storage options nearby, making this an opportune repositioning play,” he added.
James said the property also attracted strong attention from investors and value-add players.
The new owner plans to reposition the South Hampton Crescent building into self-storage space, with the partially refurbished office/laboratory building, which was originally built in 1928 for Kodak and comprises 6,048sqm of NLA.
“This location presented a unique opportunity for our construction and property development division,” said Gayle Sachs, director at Howzit My China Pty Ltd.
The former Kodak building is currently 28% leased too ASX-listed Starpharma, who recently exercised its five-year option, with the gross passing income from the property at $840,000.
The sale also includes the adjoining Duke and Bond Street land, which is currently occupied by warehouses leased on short and medium-term deals and includes an approved permit for an additional 5,107sqm, nine-level commercial building with 129 parking spaces.
“The owners have been looking for a suitable building in the Abbotsford area to expand their self-storage operations for some time now,” said Javier Rezzonico, director at Storcad and specialist self-storage designer, who is involved with the project.
“The existing building is a simple conversion to self-storage, and the approved Town Planning Permit enables a ramp-up to 500 storage units really quickly. With approvals in place and ready to go, this facility and the land next door will expand to 1,200 units in no time.”
The new owners plan to build within the town planning approval to create a state-of-the-art self- storage facility.
“We are pleased to have agreed to an unconditional contract of sale for the property. The project did not fit with our existing business model of mixed-use residential-focused projects; however, we look forward to seeing the new owner redevelop the site in the future,” said Simon Manley, general manager at Hengyi.