Elsewhere in the CBD, a 120 square metre site at Bennetts Lane sold with a permit for an 11-level residential complex, with a potential end value of more than $15 million.
A historic four-level building at 167 Flinders Lane, which sold last week at auction for $13.3 million, included a permit to add five levels.
The trend is expected to become more prevalent, after the government’s planning ally, the Victorian Civil and Administrative Tribunal, terminated a longstanding height restriction of 40 metres for a building within the “Swanston Street Spine”.
VCAT approved an 88-metre office building at 171 Collins Street – and in doing so, boosted the value of properties, and piqued the interest of investors, in the precinct affected.
At present, the four upper levels of the Bradman’s building are configured as offices and only contribute 10 per cent to the asset’s overall rental income.
Ground floor retailer Strandbags pays the bulk of the property’s $813,157 annual rental income. The building has a nine metre frontage to Bourke Street Mall, which is the State’s most expensive retail space, to lease.
Like Mr Coppel’s former 389 Swanston Street asset, which sold to Asia-based investors, it’s hoped the Bradman’s Handbag property will trade at a yield of less than 5 per cent. Mr Coppel’s site, however, offers much greater redevelopment potential which would tighten its yield.
Kliger Wood Real Estate’s Eugene Wood is marketing the Bradman’s building, for several family trusts which have owned the freehold for 50 years.