Pace Development Group picks up Hawthorn East site for office project

Pace has abandoned plans to build this nine-level apartment complex and will instead replace 9 Montrose Street, Hawthorn East, with an office.

Pace Development Group has acquired its second Melbourne development site in two months.

The Hawthorn East holding at 9 Montrose Street (pictured, top) is costing the developer $4,062,500.

Currently a 460 square metre commercial building, occupied by Crossfit Gym, which pays annual rent of $75,000 – the 478 sqm parcel was marketed with a permit for a nine-level residential building containing 34 dwellings (artist’s impression, right).

Pace, however, has abandoned the apartment plan – instead saying it will construct a commercial project.

“The timing is right for us to take advantage of the record low commercial vacancy throughout the inner eastern suburbs,” Pace chief executive officer, Shane Wilkinson, said.

“With the abundance of local amenity surrounding the property, we are confident that a new office project will be very well received by the market”.

Pace’s new site – about five kilometres east of the CBD – is walking distance to the Auburn train station and Swinburne University’s Hawthorn campus.

Savills agents Clinton Baxter, Jesse Radisich and Glenn Ye said the Montrose Street deal valued land at “an extremely high” $8500 per square metre.

The development site market has “roared back to life” since July, Mr Baxter added.

An aerial image of Pace’s new Fitzroy site (highlighted), about two kilometres north-east of the Melbourne CBD.

“With local and offshore developers snapping up sites and competing aggressively for prime real estate, clearly the looming shortfall in construction activity coupled with ongoing population growth is creating a perfect scenario for developers over the next 1-3 years.”

In July we reported, exclusively, that Pace was paying about $20 million for a 2434 sqm Commercial 1 zoned plot in Fitzroy (pictured, right) – expected longer term to be replaced with a high-density apartment complex.

Share or Recommend article

Marc Pallisco

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

Marc Pallisco