Melbourne-based property investment companies PodCo and Terraplex have commenced the first stage of the sell down strategy of their Emerald Hill Terrace portfolio of assets in South Melbourne.
CBRE Melbourne Strip Retail Investments has been appointed to market for sale the 338-340 Clarendon Street property – a 294sqm retail property currently leased by Bendigo Bank.
The property is one of 15 retail assets in the portfolio that extends from Bank Street to Park Street, forming part of the historical and highly sought after Emerald Hill precinct, which is home to cafes, restaurants, apparel, services and a bank.
PodCo and Terraplex acquired the portfolio in early 2015. 338-340 Clarendon Street will be offered via an onsite public auction on March 29.
PodCo Director Anthony Wilson commented: “We took on the project as we recognised that South Melbourne had investment attributes that can’t be found anywhere else. Direct access to the CBD, encouraging population growth, strong numbers of white collar employment, and close proximity to tourist’s attractions (South Melbourne Market & Albert Park Lake) make Clarendon Street a true 24/7 activity precinct.”
Since purchasing the portfolio, Clarendon Street retail vacancy rates have declined from 6.2% in Q1 2015 to 2.1% in Q4 2017. During the same period, yields have compress by around 160 basis points.
CBRE’s Rorey James commented: “South Melbourne has come a very long way in the last three - five years and the outlook is very positive, with residential population reported to grow some 46% by 2022, providing a major injection of foot traffic and infrastructure to this strip.
“Given the attractive investment attributes, including a fully net lease to Bendigo Bank, over 10m of Clarendon Street frontage and highly accessible rear lane access, 338-340 Clarendon Street is well suited to investors and value add buyers looking to capitalise on the underutilised landholding.”
The sale of Bendigo Bank in South Melbourne follows a number of bank transactions brokered by CBRE, including Suncorp and ANZ in Richmond, as well as the nearby ANZ in South Melbourne, which sold to a local investor in November 2016 for $5.7 million, reflecting a yield of 3.5%.
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