Beams Projects has sold its new office development in Melbourne’s fringe to a Hong Kong-based investor for $19.5 million.
Sold on a 3.7 per cent yield, the boutique office building at 45 Wangaratta Street, Richmond, in the less-established commercial precinct outside Cremorne.
The property sits on a 368sq m site which was developed by Beams Projects last year to create a seven-storey office building, wich was designed by MAArchitects.
In 2016, seven-storey residential building was planned for the site, once home to the Duchamp warehouse, but this was changed to commercial use two years later.
The sale translates to a building rate of $13,829 per sq m and a land rate of $53,100 per sq m, which has set new pricing benchmarks for the city fringe office investment market.
Richmond and Cremorne office transactions
|Address||Sale Date||Price||NLA||NLA Rate $/sq m|
|45 Wangaratta St, Richmond||May 2021||$19.5m||1413sq m||$13,829|
|675 Victoria St, Abbotsford||May 2021||$27.3m||3747sq m||$7,286|
|182-184 Stawell St, Burnley||May 2021||$14.5m||1750sq m||$8,286|
|115 Sackville St, Collingwood||Feb 2021||$7.5m||731sq m||$10,260|
|11-23 Burwood Rd, Hawthorn||Jan 2021||$17.5m||2403sq m||$7,282|
|384-388 Albert St, East Melbourne||Jan 2021||circa $12m||885||c. $13,500|
|20-30 Mollison St, Abbotsford||Dec 2020||$86m||10,000||$8,600|
^Source: JLL, past six months
The office is in the Richmond interchange precinct near the train station and 350m from Punt Road.
It was sold in a competitive expressions-of-interest campaign that generated more than 150 enquires through JLL’s Josh Rutman, and Tim Carr and MingXuan Li.
Carr said just four major transactions had taken place in the precinct during the past five years.
“The fact the building continued to lease well during the height of pandemic last year resonated well with buyers, given the continued debate about the return to the workplace and what future levels of demand for office space will be,” Carr said.
There have been a number of development applications for offices around Melbourne's fringe, particularly in the City of Yarra.
The suburb of Richmond has also attracted tenants including Bunnings, who plan to set up its headquarters in Growthpoint Properties Australia's new Botanicca 3 building.