The Grollo family is continuing to downsize its income-generating real estate portfolio, this time selling its long-time former Preston headquarters for $18.89 million off-market.
The two storey, 5490 square metre office/warehouse on 1.53 hectares at 22 Chifley Drive (Google Street View image, top) has been retained as an investment since the developer relocated about 13 years ago to one of its projects, QV, in the CBD.
Leased to payment services company Bambora, the Weighted Average Lease Expiry is 5.5 years.
The sale, to a local, is being struck at a low 3.97 per cent yield.
The deal comes five months since patriarch Bruno Grollo and two children, Adam and Leeana, via a company, Capello, banked $17.5m against $14m expectations, divesting a 1.91ha vacant industrial zoned next door (10-22 Chifley Dve), to a developer, following an on-market campaign.
Both properties were occupied by the family’s building business, nowadays known as Grocon, for decades.
The group is now headquartered at 577 Little Bourke St.
Sell down continues
Grocon escaped liquidation last May after a payment-plan was brokered with creditors, including the Australian Taxation Office, affecting 88 companies put into administration not long earlier.
Last June Capello offloaded a modern 14-storey Footscray office to Centuria for $223.7m.
Earlier this year, the family listed a Dandenong office, 165-169 Thomas Street, with a c$170m-plus guide.
Late last week, another Grollo sibling, Daniel, also Grocon’s current chairperson and chief executive, divested a level 80 apartment at Southbank’s Eureka Tower, after several months on the market, for a speculated price in excess of $10m (story continues below).
The group retains other investments and a development pipeline including the Richmond Plaza, which is earmarked for a Build to Rent based project in partnership with Singapore sovereign wealth fund GIC.
Two years ago, Grocon’s BTR division also purchased a Docklands block for an asset of this type from the AFL – outlaying $67m.
However a 2019 deal to acquire part of the Nick Theodossi dealership, in the North Melbourne pocket of Arden, fell through.
Knight Frank’s Scott Braithwaite and Paul Kempton marketed 22 Chifley Dve, about 10 kilometres north of Melbourne.
Elsewhere in the area, Sector Property Group recently outlaid $7m for a 6500 sqm Albert St block with plans for a The Base self storage facility.
Three months ago, Build to Rent outfit Make Ventures paid $40m for the 1.4ha Preston Motors dealership – which is subject to a lease expiring, with options, in up to 15 years.
Yesterday we reported Burson Auto Parts, a division of the ASX-listed Bapcor, leased a prominent two storey Chifley Drive office/warehouse – opposite the two properties the Grollo family has just sold.
In Preston retail circles, Newmark Capital last February purchased a Bunnings under construction in the suburb, on the north east corner of Bell St and Chifley Dve.
As part of that development, the hardware chain’s outgoing Preston store, on a large 3.3ha at the south east corner of Murray Rd and Chifley Dve – diagonally adjacent to shopping centre, Northland – just hit the market for lease.
Subscribe to our newsletter at the bottom of this page.