EG snaps up riverside Abbotsford office

The office has north facing Yarra River views.

EG has outlaid $27.3 million for a B-grade office on the banks of the Yarra River, in Abbotsford.

The three level building, 675 Victoria Street – a road which in this part of Melbourne is the Richmond suburb border – will be held by Yield Plus Infrastructure No 2.

The Commercial 1 zoned block has development upside.

The purchase price reflects a six per cent passing return.

With 3743 sqm of area and 115 car parks, the 34 year old asset was renovated in 2009; Icon is the anchor.

Its Weighted Average Lease Expiry is 1.54 years.

The Commercial 1 zoned site spreads 3459 sqm with significant development upside.

“The office asset is well-located in a high-quality precinct that has experienced gentrification and significant renewal in recent years, with direct access to The Main River Trail, trams, Victoria Gardens Shopping Centre and various retail offerings,” EG head of capital transactions, Sean Fleming, said.

“The property is well-suited to EG’s Yield Plus Infrastructure No 2 strategy, which seeks to acquire assets within close proximity to new and existing infrastructure,” he added.

Dawkins Occhiuto’s Andrew Dawkins brokered the deal.

Counter-cyclical investor now manages $4.3b

Over the past 12 months ago, EG has acquired nine commercial investments.

It forged a relationship with Hong Kong’s Link REIT to acquire more real estate too – which it will manage.

The group also retains its own software, which identifies opportunities and risks – for its existing portfolio and properties it is considering buying.

“The weight of capital that is now chasing income-producing property in the Australian market indicates the need for a disciplined, data-driven approach in assessing the risk profile in commercial real estate opportunities,” Mr Fleming said (story continues below).

Founded in 2000, EG controls $4.3 billion of real estate on behalf of various investors including super funds and private clients.

Its development pipeline is worth an additional $3.9b.

Managed trusts have averaged a high 16.77pc, per annum Internal Rate of Return.

Elsewhere in Abbotsford

About three kilometres east of the CBD, Abbotsford is bound by Collingwood and Richmond – two of Melbourne’s most valuable office precincts in which to buy or rent – and the Yarra River.

It is a key thoroughfare for commuters coming to the city from Hawthorn and Kew – both blue-ribbon precincts.

The suburb is set for a building burst – with Forza Capital seeking to convert a multi-level car park with an 11-storey commercial building.

Architect David Carabott is developing a nine-level office, Craftworks, on the site of a studio once occupied by Rove McManus’ Roving Enterprises.

The Alter and Hirsch families – both on the AFR Rich List – hold Abbotsford assets too, the former, the ex-Country Road headquarters on 5927 sqm, also with river frontage.

Several warehouse sites, in Grosvenor and Flockhart streets, have traded since 2018 for major apartment complexes.

EG’s new asset abuts the Acacia Place community, developed by Hampton 10 years ago.

Salta has also been building residential product on Victoria St, opposite its Victoria Gardens Shopping Centre.

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Marc Pallisco

A former property analyst and print journalist, Marc is the publisher of