Up Property has sold a strategic Dandenong investment with development potential to an offshore buyer.
The 2.05 hectare holding at 7-29 Gladstone Road (pictured, top and below, outlined) is trading for $14.75 million following an off-market negotiation by Knight Frank’s Gab Pascuzzi and Scott Braithwaite.
Currently configured for manufacturing and warehousing, the property is leased to Victoria Carpets until 2025.
Based on the annual rent the occupier pays, the asset is trading on a 5.6 per cent passing yield.
“The purchaser was attracted to the property due to its excellent access to major arterial roads and the future change of precinct with the supermarket giant Kaufland arriving on the adjoining site next year,” Mr Pascuzzi said.
Housing also abuts the site – giving the incoming owner the flexibility to pursue a residential scheme longer-term.
Mr Braithwaite said “a UK-listed tenant and the potential change of use with adjoining residential created a flexible site with long term holding income”.
The sale price achieved is a premium for the area, the brokers added.
Kaufland – which is yet to trade in Australia but has been acquiring numerous sites, including this Queensland one we reported about late this week – is awaiting approval to open at 1-5 Gladstone Road, Dandenong, an ex-Bunnings outlet also with frontage to the Princes Highway.
A major industrial employment hub – the region has been branded “Melbourne’s second city” for decades.
In July, we reported that government arm Development Victoria launched a campaign for a joint venture partner to replace five key sites in the Dandenong Central Activity District with a mix of residential, commercial and community spaces.
Armadale-based Up Property, founded and directed by dentist turned developer Adam Davidson, has been actively pursuing other major Victorian projects this year.
Earlier this month we reported Up Property won approval to replace Geelong’s low-rise Belcher Arcade with a five level office.
Elsewhere in Geelong, it owns the Inn Hotel and 126 Little Malop Street – a low-rise mixed use building recently tenanted to Barwon Health and Geelong Advertiser.
Last November, we reported Up Property paid $7 million for the high-profile Tasman Meats outlet at 107-123 High Street, Belmont – a 5000 sqm holding.
In 2017, it paid the federal government about $10 million for a 6.4 hectrae former CSIRO laboratory, also in Geelong’s Belmont.
The developer’s highest profile Melbourne site is arguably the 6.7 hectare ex-Philip Morris cigarette making factory, in Moorabbin, which is being re purposed into a mixed-use employment hub branded Morris Moor.
Up Property recently secured efm Logistics Services for 2850 sqm of a swank 5257 sqm office being renovated at 1 Cochranes Road, within the old factory grounds.
Collingwood-based Stomping Ground also committed to Morris Moor: the craft beer maker plans to create a drinking hall, event space, garden and 12 hectolitre brewery.
Clik Collective, Little Lane Learning and Schots Home Emporium – a business we recently reported listed its Clifton Hill showroom for sale – will also occupy part of the Moorabbin site which Up Property purchased for $23.7 million in 2015.
Philip Morris owner-occupied the property for 60 years until 2015.