Drapac to sell two Melbourne sites

Drapac will sell two of its most prominent Melbourne CBD sites, in deals expected to reap around $60 million.

The properties includes the flagship City Mazda property at 388 William Street, opposite Flagstaff Gardens.

Another block, 9-39 MacKenzie St, near the Royal Exhibition Building, will also be offered.

Both are permit-ready for mixed-use projects.

Drapac managing director Michael Drapac said it was a counter-cyclical listing.

He bought the parcels about four years ago.

“We invested in these sites and obtained planning approvals to build commercial office space,” the executive said.

“But the market is now showing that high-rise residential development is a far greater priority and as this is not our core business, we are selling” (story continues below).

Last month, the 1030 square metre Elizabet St site which accommodates the Stork Hotel traded for nearly $12 million – more than 80 per cent over reserve.

The Drapac sites

The City Mazda site measures 11,000 sqm, with permits for more than 70,000 sqm of offices and a 26-level apartment building.

It is expected to fetch $40 million.

The MacKenzie St property – worth about $20m – spreads 4000 sqm and will be offered as a whole or in two parts.

Knight Frank’s Clinton Baxter and Paul Burns are the selling agents.

Drapac last month launched the $300 million Drapac Sustainability Fund, which will hold only sustainable real estate.

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Marc Pallisco

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