Melbourne, 18 September 2014 – The ‘Georges’ building - a Melbourne retail icon since the 1880’s - will be brought to the market for sale in a move tipped to generate significant local and international buyer interest.
CBRE’s Justin Dowers, Mark Wizel and Josh Rutman will be handling the sale of the landmark CBD building, which is located at the east end of Collins Street. The public Expressions of Interest campaign will close 30 October 2014.
The property is currently held under a leasehold interest, by the now US-based property group Drapac, headed by Melbourne property industry stalwart, Michael Drapac.
A Melbourne institution, the original Georges store traded in the Collins Street building for 115 years, from 1880 until its closure in 1995. At that point, Country Road founder Stephen Bennett bought the rights to the Georges name from David Jones and gave the building a multimillion refurbishment and fitout under the stewardship of international designer Terence Conran.
The building was later resurrected as a series of speciality stores, service retailers and hospitality operators before being transformed by Drapac in recent years into a sought after hub for international fashion brands and hospitality operators.
In the process, the three (3) level plus basement building of 6,780sqm has been fully refurbished, while maintaining its original “New York” style design, with high ceilings, arched windows and one of Melbourne’s most iconic facades fronting both Collins and Little Collins Streets.
The building is home to a mix of elite national and local retailers including Toni & Guy, Readers Feast book store, The Longroom, Dolci Firme along with Meatmaiden, the sister restaurant to the famous ‘Meatmother’ in Richmond, who recently committed to the basement tenancy. A number of new retail deals and renewals have been negotiated which provide investors with a retail WALE of 8.4 years.
The property is currently returning a net income of $1,236,000 per annum and pricing is expected to exceed $8 million, reflecting a favourable return for investors due to the leasehold nature of the offering.
CBRE’s Justin Dowers said; “It is extremely difficult to buy real estate in the east end of Melbourne, let alone a building like Georges with such prominence and a history of retail performance.Another attraction for prospective purchasers will be the general strength of the retail market in the CBD, with Melbourne having maintained a very tight vacancy rate of 1.45%, with vacancy along Collins Street reflecting 0.53% - representing vitutally no availability of leaseable retail accomodation”.
“The sub $10 million price point makes owning a substantial and iconic asset such as this more attainable to a wider pool of buyers, it’s an incredibly rare opportunity”
CBRE’s Mark Wizel added; “Because space in general within the east end precinct of the Melbourne CBD is highly sought after, and occupied by some of the world’s most prominent fashion brands such as Dolce & Gabanna, Prada & Louis Vuitton. The introduction of these international retailers has seen this precinct become ‘ultra-premium’ within a 3-5 year period”
“Moving forward, the building will only benefit from what is happening in the Melbourne CBD by way of apartment development, tourism and a lifestyle shift which has seen people spend more time in the city.”
Adjoining the building, Grocon & APN are currently developing at 150 Collins Street, which will provide 14,000sqm of office space, fully committed to Westpac. In addition, QT hotels are set to commence construction on their first Melbourne establishment. Located at 131-141 Russell Street, the former Greater Union cinema complex is expected to be demolished with construction of a 12 level hotel and apartment building due to start this later this year. In addition to the 24 apartments, 182 hotel suites over lower levels are included.
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About CBRE Group, Inc.
CBRE Group, Inc. (NYSE:CBG), a Fortune 500 and S&P 500 company headquartered in Los Angeles, is the world’s largest commercial real estate services and investment firm (in terms of 2013 revenue). The Company has approximately 44,000 employees (excluding affiliates), and serves real estate owners, investors and occupiers through more than 350 offices (excluding affiliates) worldwide. CBRE offers strategic advice and execution for property sales and leasing; corporate services; property, facilities and project management; mortgage banking; appraisal and valuation; development services; investment management; and research and consulting. Please visit our website atwww.cbre.com.au.