OSK snares under-utilised inner-city site

The proposed 40 level tower at 190 City Road.

Malaysian developer OSK Property has picked up a low rise office in one of Australia’s most densely populated zones – outlaying a speculated $27 million.

The deal for 190 City Road, Southbank, is a boon for the vendor, Hexa Group, which paid $18.5m in November, 2020 – the heart of the COVID pandemic – then created a scheme for a 40 storey development.

In a show of how fast builder confidence in the area has ballooned, that seller, New Zealand based Datacom, picked it up following a failed auction for $7.15m in May, 2005, to occupy.

Colliers’ Leon Ma, Oliver Hay, Daniel Wolman and Matt Stagg with JLL’s Jesse Radisich, Josh Rutman, David Hill and MingXuan Li brokered the latest deal.

Elsewhere in the suburb, OSK is behind the two hectare Melbourne Square, taking shape at 93-119 Kavanagh Street – a site acquired from Mario Lo Giudice’s Banco Group for $145m in 2015.

Last year the Malaysian group banked $70m selling an essential services component of that project, with a Woolworths supermarket and childcare centre, to Primewest, now controlled by Centuria.

190 City Road

Zoned Capital City, the 1597 square metre City Rd block has multiple potential development outcomes including as an office, hotel – or mix of both, perhaps over multi-level retail.

Hexa’s scheme is for 308 dwellings.

OSK is expected to proceed with a residential-based project, possibly with hospitality, capitalising on the location, walking distance to Crown Casino (story continues below).

The 1597 square metre City Road block, walking distance to Crown Casino.

“We received multiple offers from owner-occupiers, developers and value add buyers, based locally and offshore,” Mr Ma said.

“The site is strategically connected to all parts of Melbourne through its walkability to the CBD, Flinders Street Station, Southern Cross Station and trams along ST Kilda Road,” according to the executive.

Development Victoria is planning a major park around the National Gallery of Victoria.

Mr Radisich added the proposed revitalisation of the nearby arts precinct will add value to any development.

The deal comes six months since Cedar Woods purchased a 2217 sqm block in the pocket – also zoned Capital City – expected to yield a 20-storey plus apartment complex.

Not long earlier NOVUS, a Build to Rent outfit part backed by David Southon’s Aliro Group, snapped up a holding next to that, 153-159 Sturt St, for $20.35m.

Presently a low rise office, that property was offered permit-ready for two 20 level residential buildings all up containing 170 dwellings.

Elsewhere in the suburb, Monno, the new name for CostaFox, is proposing to redevelop the historic Tea House site with a mixed use project while Time & Place is planning a 62 level apartment complex at the corner of Queens Bridge St and Kings Way.

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Marc Pallisco

A former property analyst and print journalist, Marc is the publisher of realestatesource.com.au.