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Residents of North Brighton may find they are living in the middle of a construction zone later this year, when prominent local developer Gillon Group and Sydney-based listed property giant Abacus Property Group expect to start building a $38 million shopping centre and office building in Bay Street.
The development will encompass a site at 382-386 Bay Street at the eastern edge of the popular retail strip, and on the south-west corner of Male Street.
Gillon Group director Peter Gillon said the centre would add about 2000 square metres of A-grade office space, a 4200 sq m Safeway supermarket, a 1400 sq m gymnasium and about 2000 sq m of specialty retail stores - between 12 and 20 new shops.
The development, which was approved by the Bayside City Council earlier this year, will also include a three-level, 350-bay underground car park.
It is not yet known whether Abacus and Gillon Group will retain the shopping centre as an investment upon completion in 2010, or strata title the office levels and retail shops and sell them individually.
JDA Architect director John Douglas, who designed the Bay Street project, said there was a "massive undersupply" of offices in Brighton and surrounding bayside suburbs.
He said many former company directors or executives had set up private businesses, or consultancy practices, and wanted to work in offices close to where they lived.
Traditionally Melbourne's biggest suburban office hubs are in Hawthorn, Box Hill and Dandenong, with smaller markets in Malvern, Kew and South Yarra.
Brighton's office market by comparison is much smaller, at less than 20,000 sq m, according to Nichols Crowder director Matt Nichols.
Mr Nichols said office vacancy levels in Brighton were less than 1%, with space in just one office building available for lease.
He said recent office lease deals of less than 50 sq m had been struck at high rents of about $450 per square metre, making Brighton the most expensive office location outside of the CBD and city fringe.
Mr Gillon said a lack of development sites had stunted office development in Brighton.
The Melbourne 2030 policy, which identifies Bay and Church streets in Brighton as major activity centres, has resulted in many new office developments being proposed for the retail strips, both of which surround train stations.
Other bayside suburbs identified include nearby Hampton, Sandringham and St Kilda.
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