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Deals of the week – 23 November 2020
Posted by Commercial Ready on Nov 23, 2020

New South Wales

Search for more development sites in New South Wales here.

THE ROCKS - $925 million
Dexus has handled the biggest single commercial deal of the year, selling a half stake in Sydney's Grosvenor Place (25 George Street, The Rocks) for $925 million to the Chinese Investment Corporation.

The Australian Financial Review reported that the Dexus divestment has been one of the Sydney's most anticipated deals and will set a benchmark for pricing in a turbulent office market.

While the deal achieved a notable sum, it did come in at 5% discount to the property's June book value. One cause for this has been tenancy security with the major tenant Deloitte, who account for more than one third of the NLA, intending to move out in 2022.

CBRE's Flint Davidson, Simon Rooney and Stuart McCann managed the deal with JLL's Rob Sewell (since left), Luke Billiau and Simon Storry.

AUBURN - $129.5 million
Elanor Investors Group parted with their Auburn Central shopping centre in Sydney's west, securing $129.5 million following a repositioning of the asset to focus on non-discretionary retail; the sale marks a 5% premium to its book value.

The property was originally purchased by Elanor in 2015 for just $68 million. Following the purchase an ALDI replaced a Big W and a Tong Li supermarket was added to the mix as well. Incoming owners SCA Property Group secured the asset off-market.

JLL's Sam Hatcher and Nick Willis managed the deal.

DULWICH HILL - $38 million
Pub owner Redcape has secured the Gladstone Hotel in Dulwich Hill for $38 million, marking the largest pub deal struck in NSW since March 23, when COVID-19 forced the closure of hotels across the state. The hotel, which was sold by long-term owner Craig Coote, also included a ‘Little Bottler’ bottleshop and a Local Liquor Superstore.

The hotel now joins the new owner’s $1 billion-plus portfolio and is set to undergo a major refurbishment.

JLL’s Ben McDonald and John Musca managed the deal.

DARLINGHURST - $22 million
The Courthouse Hotel, a late-night pub and Sydney institution on Oxford Street, has been scooped up by investment group Moelis Australia for $22 million. The last time the pub changed hands was more than 30 years ago.

The four-storey asset at Taylor Square in Darlinghurst, is set for a refurbishment by the incoming owner.

HTL Property's Dan Dragicevich, Andrew Jolliffe and Sam Handy managed the deal.

MARYBOROUGH - $2.7 million
A Sydney private investor has performed a slick move by snapping up a Maryborough fuel station at 71-73 Ferry Street for $2.7 million just days before it was meant to hit the market.

The asset, which was tenanted by Metro Petroleum – Dib Group Pty Ltd, had been operating as a fuel station for over 40 years. The purchaser, acquainted with the tenant, was happy to secure a long-term passive investment with three per cent annual increases.

The property was sold off-market by Ray White Commercial’s Stephen Kidd and Elliot Kidd.
 

Victoria

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RICHMOND - ~$19 million
Fortis has purchased a prominent corner site located at 8 Brighton Street in Richmond for circa $19 million. Construction on this 1,298 sqm site will commence in 2022, while the planning application is expected to be submitted in early 2021.

Located off the Church St and Swan St intersection, the site boasts three street frontages, with an abundance of amenities in its immediate vicinity. Offering more than 7,000sqm combined NLA and NSA, the $30 million+ new build will comprise retail offerings on the ground floor, with an additional nine levels of commercial and residential space. 

“Our newest site in Richmond is a reflection of our confidence in city-fringe locations, and we are excited to expand our presence in Melbourne. Following on from the success of Pallas House and our other residential developments such as Balmoral and East Grove in Melbourne, we are positive that the demand for this space will continue to accelerate in the next few years. With an expected end value of $90 million, this development is an exciting new addition to the $800 million worth of Fortis projects currently underway in Melbourne,” says Charles Mellick, Director, Fortis.

The transaction was negotiated by Ben Baines and Ted Dwyer of Colliers International.

WANTIRNA - $5 million
A Melbourne medical precinct in Wantirna has changed hands to a Hong Kong-based investor for $5 million – the latest in a spate of transactions in the strengthening healthcare sector.

The 1,630sqm property, which has an Urban Growth Zoning, is situated at 169-171 Stud Road. The asset comprises two multi-level buildings occupied by five healthcare tenants, including physiotherapist, dentist, rehabilitation clinic, lymphoedema clinic and specialist medical group. It provides a passing income of $220,000 per annum.

CBRE’s Jimmy Tat, Sandro Peluso, Marcello Caspani-Muto and Josh Twelftree negotiated the sale on behalf of the private owners.

PRAHRAN - $1.45 million
A local investor has purchased a vacant corner building at 334 Malvern Road, Prahran located between the Chapel Street and Hawksburn Village retail precincts for $1.45 million. The sale price reflects a building rate of $10,902/sq m for the two level 133sq m property and land rate of $12,083/sq m.

The deal was negotiated by Julian Heatherich and Benson Zhou of Savills Australia who said “With Victoria emerging from lockdown restrictions and confidence returning to the market, we are continuing to see an uplift in enquiry across all classes of commercial property.”

TRUGANINA - Undisclosed
An industrial site in Melbourne’s west has sold to a local developer for $4.5 - $5.4 million based on a reported sale price of a $250-300psm.

20 Meyer Place in Truganina presents an 18,050sqm landholding with 13,500sqm of hardstand and 4,550sqm of recycled asphalt.

Lemon Baxter’s James Matina and Ned Kukic sold the property off-market.

“We are experiencing a strong appetite for industrial zoned land across the western corridor being driven by rapid growth within the e-commerce, warehousing, logistics and government infrastructure sectors as a result of COVID-19,” Mr Matina noted.

“The transaction was negotiated in the midst of the pandemic demonstrating a high level of confidence within the industrial sector.”
 

Queensland

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BRISBANE, AIRLIE BEACH & MELBOURNE (VIC) - $63.3 million
ASX-listed Hotel Property Investments (HPI) has been busy recently signing off on three gaming venues for a combined $63.3 million; the Mango Hill Tavern in Brisbane for $31.3 million, the Jubilee Tavern in Airlie Beach for $9.3 million, and the Summerhill Hotel in Reservoir, Melbourne (VIC), for $22.7 million.

The acquisitions will bolster HPI's portfolio to 48 venues with a total value north of $850 million.

Cushman & Wakefield’s Nick Spiros, CBRE’s Scott Callow and HTL’s Glenn Price and Brent McCarthy, managed the deals.

MACKAY WEST - $10.4 million
The Mackay West Shopping Centre has changed hands to a Brisbane-based private investor for $10.4 million in a sign of ongoing demand for convenience focused retail assets.

The 331 Bridge Road property is anchored by a SUPA IGA supermarket and was sold off-market. The property includes four speciality stores, including BWS and Sullivan Nicolaides. It offers a 9.78-year WALE and a large land holding of 9,227sqm in Mackay’s central activity precinct.

CBRE’s Michael Hedger and Joe Tynan negotiated the sale.

MILTON - $2.23 million
A private local buyer has purchased a modern office and warehouse building for $2.23 million at 9 Mayneview Street in Brisbane’s Milton.

The 725sqm office and warehouse was on 809sqm of land and attracted interest from both owner-occupiers and investors.

The property was marketed and sold by Ray White Commercial’s Sam Parker, who said, “the asset was purchased via private treaty and was sold to a confidential local buyer within two weeks of Ray White Commercial Queensland listing it for sale.”
 

South Australia

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SALISBURY SOUTH - $10.5 million
A prime industrial investment site at 2-26 Nylex Avenue in Adelaide’s Salisbury South has sold for $10.5 million to a single interstate investor sight unseen after 9 months of gruelling phone and online negotiations.

The sprawling two-titled property presents a 60,600sqm land area and was sold leased by two blue-chip companies.

NAI Harcourts’ Gary Taplin managed the sale, stating, “To be able to complete this sale to an interstate investor, while he was not able to travel to the actual site due to coronavirus restrictions, shows that there is great confidence in major assets in our state.”
 

Western Australia

Search for more development sites in Western Australia here.

GREENFIELDS - $5.4 million
A service station in Perth’s south, near Mandurah, has traded to Melbourne-based investment company Fawkner Property for $5.4 million.

Holding address at 13 Lakes Road in Greenfields, the 184sqm building plus canopy was sold fully leased to 7-Eleven for 15 years.

Vend Property's Jeff Klopper managed the sale.



Charter Hall has traded 65 Berry Street in North Sydney for $212 million following a direct offer from local fund manager Intera Group. The sale of the office tower achieved a 10% increase on its 30 June 2020 book value; The Melbourne Square Shopping Centre has changed hands from OSK Group to Primewest’s Daily Needs Retail Trust (PWG) for $70 million; Prime Space Projects has sold Osborne’s Centre of Defence office with an adjoining tract for $48.25 million; plus more
A new drive thru Starbucks in Queensland selling at a record yield of 4.2% set the tone of commercial property agent Burgess Rawson’s final Portfolio Auction of the year in Melbourne today.
Lendlease have secured another 25% of 1 Farrer Place, a Sydney CBD landmark, from GPT Group for $584.6 million (in line with its most recent book value); a deal that demonstrates the resilience of trophy towers; Perth-based property syndicator Kerching Capital has realised $12.6 million from the sale of the Sandstone Point Village neighbourhood centre in Brisbane’s north; The Elanor Healthcare Real Estate Fund has acquired a new asset for its portfolio, this time splashing out $22.9 million for a multi-tenanted medical facility in Rockingham; plus more.