South Melbourne office sells to Andrew Fox for $5.2 million

Executives associated with land surveyors Bosco Jonson – which in March adopted the business name Veris Limited – have sold a South Melbourne office for $5.2 million.

The property – a triple storey building (pictured top, left and bottom) with 715 square metres of gross lettable area and 12 car parks, on land of about 391 sqm – is trading on a low passing yield of 4.8 per cent.

The incoming purchaser according to title documents, Andrew Fox, the son of trucking magnate Lindsay, is paying $7,272 per sqm of building area, or $6,410 per sqm of lettable area.

The Fox family paid $4.4 million for the neighbouring office, 8-14 Eastern Road, South Melbourne, in late 2015.

The Fox family also own the neighbouring property, 8-14 Eastern Road, South Melbourne (pictured, right) – paying $4.4 million in late 2015 under the business name Fox Eastern Road Pty Ltd.

It is expected Mr Fox, who runs the family’s Linfox Property Group, will refit the existing buildings as that company’s headquarters, or consider building a new one on its amalgamated land holding, now spreading 989 sqm.

This pocket of South Melbourne has a building height limit of six storeys.

Linfox Property Group has recently been seeking to replace its current headquarters, 493 St Kilda Road, with an apartment building. Earlier this year it was reported the family was an underbidder for VACC House at 464 St Kilda Road.

Veris Limited has been a long-time occupier of 16-22 Eastern Road. It pays $252,000 per annum in rent on a lease ending in 12 months.

Lemon Baxter managing director Chris Curtain and colleague Paul O’Sullivan marketed the property via an expressions of interest campaign which closed on October 5.

Neither agent would confirm the identity of the buyer when contacted.

Throughout the campaign, the brokers marketed the site’s development potential.

It was offered with a design scheme penned by Hayball Architects, a firm which we reported last month sold its South Melbourne headquarters, with a residential redevelopment permit, to Evolve Development for about $30 million (coincidentally, another architecture firm, Rothelowman, is also selling its South Melbourne office permit-ready for an apartment building. This site is expected to trade for about $20 million).

Mr Curtain said his agency fielded more than 150 enquiries for 16-22 Eastern Road. Four bidders – all potential owner occupiers – made it to the final round of negotiations.

The site adjoins 142 Dorcas Street, South Melbourne, which the state government acquired earlier this year for $23 million to rebuild as a new police station. If the Fox family build a six storey office on its Eastern Road holding, it is likely upper levels will enjoy view security to the south over the police complex.

Elsewhere in the suburb, a local investor last week paid $32.01 million for an office at 210 Kings Way with redevelopment potential.

Builder Steller Group last year paid $23.4 million for 200 Wells Street – an office coincidentally occupied by Lemon Baxter – the agency which also sealed the recent Dorcas Street and Kings Way deals.

Mr Curtain said investors, and tenants, were increasingly attracted to South Melbourne given the amenity and public transport facilities.

In late 2016, members of the Fox family paid $1.15 million to buy their father’s childhood home at 22 Stewart Street, in the Prahran pocket of Windsor. This purchase was made just before Lindsay Fox’s 80th birthday.

An aerial image showing 16-22 Eastern Road (shaded) in relation to the Melbourne CBD.

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Marc Pallisco

A freelance property analyst and journalist, Marc is a co-founder of realestatesource.com.au.

Marc Pallisco