Cremorne Development Transaction Continues Spate of Inner Melbourne Sales

Boutique Melbourne-based developer CostaFox has purchased a Cremorne development site in inner-Melbourne for $12 million.

The 1180sq m site at 1-11 Gordon Street would be re-developed into a 5000-6000sq m office project.

The building was sold by Icon’s director Ashley Murdoch who had spent $7 million acquiring the site in two lots as a private investment. The Melbourne-based developer combined two lots to create the asset.

Cremorne’s office precinct has become popular with the creative and technology industries with property values and rents rising.

Related reading: Landlord’s Need to be ‘Flexible’ in a Changing Office Market

In late 2017 Icon put its 594-610 Church Street, Cremorne development site on the market with plans lodged with council for an eight-storey office building with retail space. The former Nuttelex building is located on the corner of Church and Balmain Streets.

CostaFox’s development business was set up with the backing of Costa Asset Management, a diversified agricultural, equity and real estate business chaired by Robert Costa. Managing director Michael Fox a former Little Projects development executive.

CostaFox late last year lodged plans for a 40-storey mixed-use tower in Melbourne's Fisherman's Bend precinct. Designed by Rothelowman, the mixed-use development will provide for a variety of uses including residential, retail, café and commercial office space.

Elsewhere in South Melbourne, CBRE hotels has sold the freehold investment in The Montague Hotel on a tight sub 4.5 per cent yield. The property was sold off market, with CBRE acting on behalf of the Fermanis family. The hotel is underpinned by an 18-year lease, with further five-year options, to its operator.

The Fermanis family is also currently marketing its Abbotsford pub, The Retreat Hotel.