Melbourne, 24 January 2013 - The prominent Melbourne CBD home of State Trustees has been listed for sale for the first time in over 40 years, providing a rare opportunity for investors and developers to secure a foothold in one of the city’s most tightly held commercial precincts.
CBRE Melbourne City Sales has been appointed to sell 168 Exhibition Street by Expressions of Interest. The building is located just off the corner of Bourke Street at the ‘Paris End’ of the CBD.
The 11-level building has a net lettable area of approximately 6,298 square metres and includes basement car parking and ground floor retail space.
Mark Wizel and Josh Rutman will steer the EOI campaign, which will close in the middle of 2013.
The property, which comprises a total land area of 748 square metres and provides two street frontages at the corner of Mornane Place, is fully occupied by State Trustees. The sale will include a short term leaseback, with Vacant Possession to be achieved towards the end of 2014.
At the expiry of the lease, State Trustees has committed to relocate to Grocon’s $350 million McNab Avenue development which abuts the Footscray railway station.
Commenting on the development, State Trustees Managing Director Tony Fitzgerald said the Footscray site provided an exciting opportunity for a new retail space and head office.
“As the demand for State Trustees’ services increases, the relocation of our head office to Footscray signals our commitment to the growing community and particularly to Melbourne’s west,” Mr Fitzgerald said.
“State Trustees made the decision to relocate to support our core business strategy of serving our clients’ needs and follows the success of our recent office openings in Dandenong and Bendigo.
CBRE Director, Mark Wizel said; “The ability for a purchaser to acquire an asset like this is rare, as it ticks all the required fundamentals when assessing an investment with value add potential. The property offers short term income from State Trustees. At the expiry of the leaseback a buyer will have the opportunity to refurbish and re-lease, to undertake a strata sub-division or to investigate a conversion, subject to the relevant planning approvals.”
Mr Wizel added that the building also presented an exciting opportunity to reconfigure the ground floor retail area given the quality of many food and beverage operators that surround the building.
The north eastern core of the Melbourne CBD has been one of the city’s strongest performing precincts. The vacancy rate in this precinct is just 3.9% compared to 5.6% for the overall Melbourne CBD market.
CBRE Senior Manager Josh Rutman said low vacancy rates in boutique East End Melbourne commercial office buildings were assisting in driving increases in rentals – particularly in the eastern core.
”These strong underlying fundamentals combined with the location in Melbourne’s tightly held East End will help drive buyer interest in 168 Exhibition Street,” Mr Rutman said.
“The attributes of the property, coupled with the clear value add potential that the asset offers the successful buyer, will be the drawcard in generating significant interest in the campaign, not only from local and interstate buyers but also off-shore, particularly from Asia,” Mr Rutman said.
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