NASDAQ listed LeMaitre Vascular – which manufactures artificial veins, a patented technology – has sold its Australian sales centre near the site taking shape as the Arden train station, part of the $11 billion Metro Tunnel project.
The buyer outmuscled a mix of other owner occupiers, and investors, to secure 36-40 Munster Terrace for $2.701 million.
The deal values each of the block’s 380 square metres at $7,108.
Based on current planning guidelines, the Mixed Used zoned land could be redeveloped with a four level complex atop basement car parking.
Currently the property includes a double storey 350 square metre building configured with office, warehouse and manufacturing space.
The North Melbourne site is within the area covered by the Arden Vision Precinct Structure Plan which aims to rebuild the inner north west Melbourne pocket with a mix of housing and workplaces.
In December we reported that Grocon and financial partner GIC were paying luxury car dealer Nick Theodossi about $135 million for a collection of 12 sites in the area.
Those properties, a collection of showrooms and warehouses, are now earmarked to make way for an apartment based village with build-to-rent components.
Interest cheaper than rent in some cases: CBRE
According to Mr Minty, average office rents in Melbourne’s inner city rose 16 per cent last year.
Property costs sometimes borne by the occupier – namely land tax – are also adding to the expensive of renting, the broker added.
“Owner occupiers are seeking an opportunity to capitalise upon the current low cost of debt to secure their own building as a strategic cost effective decision,” Mr Minty said.
“We are seeking a heightened level of demand for freehold buildings in Melbourne’s city fringe driven by owner occupiers seeking to transition from being a tenant to a landowner.
Mr Kilner added that in some instances, annual rental payments “can outweigh the annual mortgage repayments from debt obtained for the purchase”.
The broker added that North Melbourne is particularly popular given the Metro Tunnel project, which will see a train station connect the area to South Yarra via Parkville and the city.
The existing North Melbourne train station was to have been renamed West Melbourne – reflecting the suburb it is actually located in.
But earlier this year the government confirmed that plan would not proceed and North Melbourne train station will continue at its current location.
The Metro Tunnel train station which was supposed to be named North Melbourne station will instead be known as Arden.
CBRE said its 36-40 Munster Terrace sale values every square metre of the building at more than $7700.
Four months ago River Nile School paid $2.05 million for 13-15 Cobden Street, a deal which valued every sqm of land at $21,800, which CBRE said set a record.