Hengyi pays $17.5m for waterfront hospital

Shanghai-backed developer Hengyi is paying Peninsula Health a speculated $17.5 million for a vacant hospital on a waterfront site in Mt Eliza’s Golden Mile.

The 3.4 hectare parcel at 33 Jacksons Road, overlooking Canadian Bay, is expected to make way for apartments, townhouses and standalone homes.

This marks the property’s first change in use since the 1930s when it opened as the orthopaedic branch of the Royal Children’s Hospital.

Later, it treated patients with polio and tuberculosis, then, in the 1970s, was converted to a nursing home.

Most recently branded The Mount Eliza Centre, 33 Jacksons Rd was occupied by Peninsula Health, which, along with Victoria’s Department of Health & Human Services, was the vendor.

Included in the sale are heritage protected buildings, some which the marketing agents promoted for their potential to be reconfigured as, amongst other things, part of an aged care complex or boutique hotel.

This might still be the case if Hengyi decides to subdivide and sell-down the portion the old buildings sit on, and construct new dwellings, around it.

Other than to confirm the transaction, CBRE’s Mark Wizel and Lewis Tong declined to comment about any part of their campaign.

The brokers targeted owner-occupiers, developers and investors within the retirement community, medical, hospitality and education sectors.

Residential builders, however, were expected to dominate enquiry – the site sitting in a prestigious pocket of the suburb and lending itself to medium density development.

Hengyi’s Melbourne-based general manager Simon Manley said the builder is excited to deliver a unique product to Mt Eliza – and that it is currently contemplating a series of small, different, planning schemes for the parcel (story continues below).

A subsidiary of Shandong HYI Group, the company is perhaps best known in Melbourne for its city skyscrapers including Swanston Central, set to rise 72 storeys at 168 Victoria Street, Carlton, and in the CBD, the 69-storey Light House at 442 Elizabeth St and The William, which replaced a long-vacant 21-level office building at 199 William St.

The Mount Eliza Centre carried price hopes of about $24m when it was in 2017 offered then shortly after, withdrawn, allowing the historic components to be protected.

Prior to its being a hospital, the land accommodated a holiday home, Beachleigh, built in 1878 by architect Thomas Watts.

Elsewhere in the area

In 2016, Ryman Health paid the University of Melbourne’s Business School nearly $40m for a historic 8.9ha property, Moondah Estate, in Mt Eliza.

That site is expected to be replaced with an aged care complex.

Last August, we reported retirement village developer Charles “Chas” Jacobsen spent $33m on The Ansett Estate – a 22.3ha waterfront parcel next door to the Ryman Health holding.

Twelve years earlier, Mr Jacobsen paid the Ansett family $14.5m for Sir Reginald Ansett’s Gunyong Valley, next door to his most recent buy.

Sir Reginald also once owned Moondah Estate.

The Ansett Estate, offered by the R.M Ansett Trust in November, 2017.

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Marc Pallisco

A former property analyst and journalist, Marc is the publisher of realestatesource.com.au.

Marc Pallisco