Since the 1990s, several major government controlled sites in Maidstone, including the Philip Migrant Hostel and Department of Defence land, have made way for new housing estates. The Medway Golf Club is the suburb’s most prized potential development site being on hillside land abutting the Maribyrnong River, opposite Avondale Heights.

For R.Corporation, the purchase continues a trend of buying in Melbourne’s suburbs. Last June it paid $20 million for a four hectare block in Cheltenham, about 20 kilometres south-east of town.

R.Corporation has developed townhouses in Buncle Street, North Melbourne, opposite a prominent commission flat tower compound. Its project, Park Terraces, replaced a factory site once occupied by esky manufacturer Willow, and which R.Corporation bought for $7.06 million in mid-2007.

Colliers International marketed the Maidstone site for Australia Post, but selling agents Shane Dargue and Nathan Bingham refused to comment. An R.Corporation representative was unavailable.

Six weeks ago, Australia Post withdrew from sale a prime 1.2 hectare development site at the CBD/Docklands border on Spencer Street, which was expected to fetch between $40 and $45 million.

Sources say R.Corporation will team with Crane Corporation and Sydney-based developer and fund manager Charter Hall to develop the site into high rise apartments, townhouses and retail space.

It’s understood Charter Hall will also purchase the network’s Willoughby studios on Sydney’s north shore in a deal worth about $120 million, however this could not be confirmed.

The 3-hectare site at 22–56 Bendigo Street in Richmond includes more than 30 buildings, some of which are heritage protected. The site has a wide frontage to Stawell Street, Khartoum Street, Jago Street and Weitheim Street and has been used as the Melbourne studio for the television network since 1956.

Currently zoned Industrial 1, the site is expected to be rezoned Residential next year, which would pave the way for a major redevelopment.

A representative from R.Corporation declined to comment on any negotiations when contacted by The Age. Spokespeople from Consolidated Media, Charter Hall and Crane Corporation failed to return calls.

Colliers International’s eastern office chief executive Rob Joyes, who is marketing the Richmond property, denied Consolidated had yet entered the due diligence process with any specific contender.

However, well placed sources say negotiations are advanced on the site, considered one of the best infill development sites offered in Melbourne for years.

Groups understood to have tendered on the Richmond site include Australand, Mirvac and Devine Limited. Private investors including Lindsay Fox and Paul Little are also believed to have thrown their hat in the ring.

Consolidated Media has issued an 11,000 square metre leasing requirement in Melbourne’s inner-city, with a site in Docklands widely tipped to become the Nine network’s new home. The network is also looking for around 25,000 square metres of office and studio space in Sydney’s western suburbs.

It’s believed offices in both cities must be available by mid-2009, which limits the company’s accommodation options to existing buildings or sites currently under construction.

R.Corporation, the private development company of former banker Andrew Rettig, has been flexing its development muscle in Melbourne over the last few years, developing more than 20 landmark buildings into boutique residential, retail and office projects totalling around $600 million.

Its biggest project to date is the Botanicca Corporate Park in Richmond which it developed with Macquarie Bank into offices.

Nearby, it has developed the former Victoria Brewery site in East Melbourne into Tribeca, a mixed use retail and residential project. It teamed with Babcock & Brown and Red C to develop the $240 million project.

Its biggest continuing project is in Surrey Road, South Yarra, where R.Corporation is redeveloping a former council transfer station into Clara, a luxury $140 million village near the Jam Factory and Chapel Street.

Swimsuit model and designer Jodhi Meares was employed as a lifestyle collaborator for that project, which also includes a distinct vertical garden.

Mr Rettig was unavailable for comment when contacted by Capital Gain. Kelemen Commercial directors and selling agents Andrew Egan and Rudy Kelemen declined to comment.

In a sign of how far density levels have come in Melbourne’s middle suburbs, it’s speculated the site could make way for a village containing more than 500 dwellings, most likely configured as units and townhouses.

About ten years ago, the vendor of the site, Cavanagh Residential Park Pty Ltd, had planned to redevelop the vacant block into a park, and an Over 50s community with about 150 dwellings.

Elsewhere in the immediate area, developer Hallmarc recently paid $17 million for the Highett headquarters of security transaction products giant, Leigh Mardon.

That purchase included a 4643 square metre vacant tract of land, earmarked to become offices and apartments.

Woolworths is also building a $50 million-plus mixed use development on a 1.1 hectare site it acquired for about $17 million during the economic downturn, near the Highett train station.

Earlier in the year, it was reported interests associated with education service provider Holmesglen paid developer Leighton Properties about $20 million for a site at 300 Bay Street, Cheltenham, which it is rumoured school will eventually owner occupy.