Myer family sells suburban Melbourne asset for $25.5 million
Postscript: this property was reported as sold by The Australian on September 20, 2018. The incoming owner, a first-time investor to Melbourne, based in China, is paying $25.5 million.
The Myer family is a step closer to selling an office investment in Melbourne’s Tally Ho business park, receiving seven formal offers following a marketing campaign launched last month.
The three-level, 4509 square metre office on an “oversized land holding” of 1.71 hectares at 12 Lakeside Drive, Burwood East (pictured above, left and bottom), was expected to trade for more than $22 million.
Fully leased to government agency VicRoads – which has just extended its stay by three years – the asset, with 350 car parks, returns annual rent of $1,642,088 with fixed 3.5 per cent increases
The property was marketed as an investment – but agency CBRE also promoted the flexible Commercial 1 zoning, and its potential to be redeveloped.
Alternatively, part of the site, which is hilltop and offers views into the business park, could make way for a new building longer-term.
Any deal comes nine months after an office on 5.7 hectares of land, owner-occupied to Hewlett Packard at nearby 353-383 Burwood Highway (which is across the road from Tally Ho), sold for $88 million to a China-based developer.
An expressions of interest campaign for 12 Lakeside Drive, managed by Kiran Pillai, Scott Orchard, Josh Rutman, Matthew Szakiel and Lewis Tong is now closed. The site is registered as belonging to Myer Family Company Holdings and co-owner, Yulgibar – which is controlled by members of the Baillieu and Myer families.
Mr Pillai said: “It was clear to see from the depth of interest for the Hewlett Packard property, with a large development opportunity associated with it, the confidence the market has about the long term commercial future of Tally Ho.
“With new commercial development and major infrastructure projects bolstering overall appeal, the Tally Ho office precinct is quickly becoming the preferred and most centralised location in Melbourne’s east, which will ensure the continued appeal of quality buildings to tenants and business indefinitely.”
Last year, Myer Family Investments sold a seven-level office at 312 St Kilda Road to Singapore’s Tong Eng Group for close to $77 million – a deal which reflected a tight 4.6 per cent passing yield.
Coincidentally, Tong Eng Group acquired an asset in the Tally Ho business park last September, paying $18.1 million for 8 Lakeside Drive, the headquarters of the Country Fire Authority.
Tally Ho is considered Melbourne’s first master-planned suburban business park. It was built more than 20 years ago on land which once part-occupied by the Tally Ho boys home and a hotel. The site was once also part-controlled by sauce and jam maker Abel Hoadley, who, according to this Wikipedia post, invented the Violet Crumble chocolate bar there.
About 16 kilometres east of the CBD, on the corner of Burwood Highway and Springvale Road, the complex spreads 26 hectares and includes 17 commercial assets.
Within the complex, in 2015, Canberra builder Dennis Millen sold 13 Vision Drive for $22 million – twice what he paid GPT in 2009.
