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Capital Gain
A St Kilda Road office building overlooking Fawkner Park is for sale with a price around $60 million, as the leafy boulevard full of ageing offices slowly returns to its residential roots.
The James Richardson Group, founded by the late duty-free king David Mandie and part of the Evelyn Danos family office, is offloading the 10-level tower at 479 St Kilda Road.
Once lined with mansions, St Kilda Road is now dotted with luxury apartment buildings. Their presence has put a lid on the prices the offices once commanded.
Records show the JR Group paid a cool $26 million in 2002, buying the tower from Christine Christian’s Dun & Bradstreet credit ratings agency. That proved good timing – many of the buyers who made purchases in the past decade have suffered.
The 3036-square-metre site is in the best part of the strip, the eastern side – the odd numbers between Toorak and Commercial roads – which backs onto Fawkner Park.
Last week, Fawkner Property Group bought the tower where it had been renting at No.484 for $65 million. Its landlord, a Swiss fund, paid $94 million in 2014.
Last year, retailer Solomon Lew also snapped up the building he rented at No.417. His landlord, Singaporean government investor Mapletree had paid $144.7 million in 2017. Given its Fawkner Park backyard, the $86 million price was a serious bargain.
Doing better was Dymocks Properties, the property arm of the Forsyth family’s book emporium. Earlier this year, Kokoda Property Group committed to a $100 million-plus purchase of No.441, with plans for an18-storey tower. Dymocks had paid $82.1 million for the building in 2014.
“You can count on one hand the remaining development sites with direct frontage to Fawkner Park,” JR Group general manager James Aldred said.
“In the St Kilda Road dress circle, No.479 is the best seat in the house. We’ve already seen strong interest from a select group of private buyers and experienced developers who see the opportunity to deliver something genuinely special in this location,” Aldred said.
The building comes with a Bates Smart design for a $400 million 20-level tower with 100 apartments.
Teska Carson’s Michael Ludski, Michael Taylor and Luke Bisset have the listing.
The JR Group is building a five-level mixed-use project at 535 Malvern Road in the heart of the Hawksburn village.
Bank on it
The Commonwealth Bank has taken the extraordinary step of advertising for a new flagship branch as a 2028 lease expiry date at the Galleria Shopping Plaza draws close.
The bank is a fixture in the 3000-square-metre space, which has been its branch since the 41-storey tower above, on the corner of Bourke and Elizabeth streets, was completed in 1983.
It belonged to the State Bank of Victoria at the time and the tower was called the State Bank Centre.
Unfortunately, the recession and some questionable investments triggered the state-owned bank’s collapse, and it was taken over by the Commonwealth Bank in 1990.
The bank sold it to the Commonwealth Property Office Fund (later renamed DEXUS CPA Trust) for $151 million in February 1999.
The tower above also housed the CBA’s thousands of workers, but they’re all about to move to Cbus’ new tower up the hill on the corner of Queen Street.
Knight Frank’s Michael Di Carlo and Craig Carr are running the very public request for a 1200 to 3000 square-metre space in the CBD core that could be ready by January 2028.
It’s understood the CBA wants to ensure it has an alternative space at hand if negotiations with Dexus are not harmonious. It also needs space with both access and security.
Last year, ANZ closed its flagship branch at the foot of 55 Collins Street. It had been an anchor tenant since the Collins Place towers were built between 1978 and 1981.
It no longer has a flagship branch as such, but there are four outlets in the CBD including the biggest, ANZ Royal Bank at 293 Collins Street.
City fringe
Byron Bay-based fashion retailer Afends has signed a six-year lease on 289-291 Brunswick Street, Fitzroy, a former Dangerfield outlet, at $130,000 a year.
Acai and frozen yoghurt scoopers Yo-Bar have leased 271-273 Lygon Street. Rents in the block, south of Faraday Street typically earn between $600 and $700 a square metre.
And close to the Church Street intersection in Richmond, optician chain Bailey Nelson has signed up to a five-year lease at 224 Swan Street, paying $764 a square metre.
The deals were done by Fitzroys agents James Lockwood and Shane Mills.
Lockwood said multiple new tenants were moving into Lygon Street. Cult sandwich maker Hector’s Deli and Italian eatery Pasta Go Go are also opening soon.
Strata office
The strata office market, dampened by high interest rates and higher office vacancies, is making a quiet return.
In the Fender Katsalidis-designed building at 171 La Trobe Street, opposite RMIT University, the whole of level two is for sale at around $3 million.
The 434 square-metre office is offered vacant after being occupied by an education business for many years.
Records show the Australia Asia Education & Migration Centre paid $1,025,000 for the office in 2004. Fitzroys’ Lewis Waddell and Brent Glassford have the listing.
Down the west end of the street, level eight of 313 La Trobe Street, another 1990s-era building, is also for sale.
Records show it last changed hands in 2024 for $3.25 million to education provider Swenee Patel.
Patel’s Harward International College pays $318,000 a year in rent and has a five-year lease on the 489-square-metre office expiring in 2030.
It’s for sale through Commercial Bureau Real Estate’s Gideon Marcus for $4.9 million.
The building is dominated by the Royal Australia and New Zealand College of Psychiatry which owns five levels of the 13-storey building.
The listings come off the back of some recent sales, notably small suites covering 216 square metres at Golden Age’s newly finished 130 Little Collins Street, where prices continue to fetch between $15,000 and $20,000 a square metre.
Cushman & Wakefield’s Jack Cooper, who did those deals with Oliver Hay, said “those prices are difficult to replicate elsewhere in the city”.
Cooper, with Anthony Kirwan, also recently sold suite 3.1 at Alcaston House on the corner of Collins and Spring streets to an occupier for $1.48 million, or $15,417 a square metre.
Not every part of the city scores such high prices. In the CBD’s mid-town precinct, a 115-square-metre office at 102/167-169 Queen Street fetched $525,000.
An occupier also bought that office. Jones Real Estate’s Mimi Hoang and Oscar Sturm did the deal.
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