Spotlight pays $185m for trophy Melbourne office
Spotlight Property Group, controlled by the Fried and Fraid families, has snapped up a trophy new office from developer Bill McNee.
The 12 level St Germain at 489-505 Toorak Road, Toorak, cost $183.5 million – a 5.5 per cent net passing yield.
With 13,095 square metres including a ground floor Coles, it is fully leased.
The weighted average lease expiry is 7.3 years.
There are also 169 basement car parks.
The site spreads 2661 sqm zoned Commercial 2; it previously accommodated the Village Way retail and office complex and a large open-air car park.
“In the current environment, capital is highly selective,” Cushman & Wakefield’s Daniel Wolman, who represented Mr McNee’s Vicland with Nick Rathgeber, Oliver Hay, Leigh Melbourne and Leon Ma, said
“Investors are targeting long-WALE, fully leased assets in blue-chip locations, and they are prepared to price that certainty accordingly,”, he added (continues below).
“While secondary office continues to trade at discounted pricing, stock with strong income profiles has shown greater resilience, particularly in tightly held village-style precincts,” according to the executive.
“Toorak remains one of Melbourne’s most exclusive suburbs with household incomes and professional employment levels well above metropolitan averages.
“For occupiers, the appeal extends beyond proximity to the CBD to include amenity, lifestyle and brand alignment.
“More broadly, this transaction reinforces a theme increasingly evident across capital markets: liquidity has not disappeared, but it has concentrated around quality”.
Also this week, SPG sold a 3306 sqm apartment development site, 402-416 Chapel Street, South Yarra, to a local group.
Subscribe to our newsletter at the bottom of this page.
