Sources say the 11-storey B-grade building sold on a yield of around 7.5, believed to be a record low for the street which runs parallel to St Kilda Road, opposite Albert Park Lake.
The 8400 square metre building only recently filled a 3300 square metre vacancy and was sold fully occupied. The buildings biggest tenant is Earthtec, which occupies about 4000 square metres. According to CityScope, the building has 117 car parking bays.
The building is flanked by two low rise residential properties, including one occupied by the Indonesian Consulate. Its position allows light and bay views to most of the office areas of the building, often a criticism of offices in St Kilda Road.
Macquarie Property divisional director Guy Nelson declined to comment when contacted by The Age. Lemon Baxter director Chris Curtain, who was marketing the building, also declined to comment.
The building was sold by a syndicate of local and West Australian based investors. It paid $8.95 million for the building in 1999 on a high yield of 14.4 per cent, prior to undertaking a major refurbishment. The same group of private investors also owns office buildings nearby at 210 Kingsway and 39 Park Street in South Melbourne.
The sale at 71 Queens Road is one of the biggest in the St Kilda Road precinct this year. According to Colliers International research, three office buildings have sold in the last twelve months including 468 St Kilda Road for $38.7 million, 474 St Kilda Road for $29 million and 505 St Kilda Road for $15 million.
The only office building to sell in the street recently was in late 2004, when syndicate WRF paid $19.5 million for a 12-level B-grade building at 11 Queens Road.