A healthcare investment facing Cato Park to the north and the valuable Hawthorn East employment precinct to the west, will be auctioned on August 29.
Smile Design Dental has occupied 368 Tooronga Road, Hawthorn East, for more than 20 years.
It is being sold with a 10-year lease to the tenant, which pays current annual rent of $78,300. Smile Design Dental then has lease renewal options.
The vendor – as is often the case with Australian healthcare investments – is in the medical field.
Appel Property’s Ben Appel is the transaction manager.
The asset is expected to sell for more than $1.5 million.
Hawthorn East is is one of Melbourne’s most exclusive suburbs with an average household income 52.5 per cent above the state average, CBRE marketing agents Sandro Peluso, Josh Twelftree, Jimmy Tat and Marcello Caspani-Muto, said.
At the south-east corner of Bluff Street, the 520 square metre holding includes a 147 sqm former house which has been converted – and permitted – for medical use.
A car park and walkway has been built into the former front and side yard.
The offering also includes a backyard – allowing any incoming owner to extend the premises longer-term.
A multi-level redevelopment could also be an option when the property becomes vacant.
About eight kilometres south-east of the Melbourne CBD, the land is zoned Neighbourhood 1.
Mr Peluso expects the affluent suburb’s “earning power” to attract domestic investors and healthcare professionals to consider 368 Tooronga Road.
“This property represents an opportunity for a number of investors to secure a medical facility which benefits from an established dental tenancy, a blue-chip location and capital intensive fit-out,” the agent said.
“All outgoings are paid by the tenant and there are dual layers of security in the form of monetary deposit and a director’s guarantee.
“The clinic’s owner has an operational history spanning four decades and has successfully operated multiple clinics around Melbourne”.
East Hawthorn in the news again
The Hawthorn East employment precinct across the road contains buildings rising up to four levels – one of which is tenanted to hardware giant Bunnings as its headquarters.
The 368 Tooronga Road site is five holdings away from Toorak Road and the Toooronga Village shopping centre which Newmark Capital acquired from Stockland for about $64 million last month – as we reported here.
In May, we reported that Charlie Buxton’s Cadence Property Group paid $6.5 million for two adjoining warehouses at nearby 1-5 Hall Street.
In April, we reported that former Melbourne Knights coach Tony Vrzina sold a small, nondescript showroom at 31 Hall Street for $2.7 million.
CBRE brokered both Hall Street deals.
The suburb’s former gasometer site – which became one of the city’s highest-profile Masters a few years ago, is also in the vicinity. This Toorak Road property is shortly set to reopen as a HomeCo retail centre, occupied by Anaconda, Woolworths, South Pacific Health Club and Chemist Warehouse.
According to CBRE, more than 160,000 cars a day transverse the nearby corner of Toorak and Tooronga roads.
“The property would continue to benefit from its proximity to some of Melbourne’s most elite suburbs, including Malvern, Toorak, Kew, Glen Iris and Camberwell,” Mr Peluso said.
“Last year, a report by Domain Group found that Hawthorn East had experienced staggering median house price growth up 98.1 per cent in five years, making it one of Melbourne’s best performing suburbs.
“The area’s average household income in the main trade area is 52.5% higher than the Melbourne average and the forecast average annual growth rate in retail spending is 4.2% to 2031,” Mr Peluso added.