This article is from the Australian Property Journal archive
A FULLY tenanted South Melbourne retail investment opportunity sold for around $5 million, with a short 27-day settlement period demonstrating ongoing demand for city fringe assets.
150-158 Montague Street is currently leased to European automobile company Ducati, who are a year into a five-plus five-year lease, which brings in a a net passing income of approximately $250,000 per annum.
The showroom occupies a 767sqm Capital City 1 zoned landholding under the Fisherman’s Bend Urban Renewal Structure Plan (STCA) and boasts circa 26 metres of street frontage and rear access.
Daniel Wolman, Oliver Hay, Leon Ma, and Alexander Leggo from Colliers managed the off-market transaction, which drew interest from developers, investors and owner occupiers, before selling to a local investor on a circa 4.5% yield.
“Despite concerns around rising interest rates, demand for well-located city fringe assets continues to demonstrate the ongoing confidence in the Melbourne commercial market,” said Wolman.
Wolman also noted the property as an outstanding investment due to its secure national tenant and strategic location in the Fisherman’s Bend precinct, which “provides the potential to capitalise on a flexible development project in the future”.
“The property is a short walk to the South Melbourne Market and in a high exposure position, making it a prime location for various retailers,” added Wolman.
The more flexible location of South Melbourne also includes access through a range of transport links, such as the future ANZAC station, in addition to surrounding retail and hospitality offerings.
This is the latest city fringe transaction for the Melbourne City Sales Team, following 16-20 Thistlethwaite Street, 166-174 Inkerman Street and197 & 197b Brunswick Street.
This on top of last week’s $51,785,000 East Melbourne sale of a five-level office building to locally-based commercial property investment manager, Bayley Stuart and the core Southbank site sale with JLL of 190 City Road to Malaysian developer OSK Property.
