Towering Investment Trend in CBD Office Buildings

Commercial property rise

Investors have further stimulated Melbourne’s buoyant commercial market in the past few days, signing on for more than $1 billion in investments in major office towers.

According to the AFR, the latest office tower to go into due diligence is a 15-storey building at 628 Bourke Street, which Swiss pension fund investor AFIAA is looking to acquire on a yield of less than 6 per cent.

The $180 million building is owned by M&G Real Estate, which acquired the property just three years ago.

The Bourke Street property was brokered by Colliers International's Nick Rathgeber and Leigh Melbourne.

Meanwhile, two Singapore-based funds giants have surged into Collins Street to invest into development stakes in two towers being offered by Mirvac.

The smaller of the two is a nine-storey tower at 664 Collins Street, where the Morgan Stanley Real Estate Investing platform has taken a $140 million half stake through its new pan-Asian fund on a yield of around 5 per cent.

Mirvac has also found a Singaporean buyer for a $420 million half share of its Olderfleet development at 477 Collins Street on a yield of around 4.75 per cent.

The Mirvac fund-through deals were brokered by Colliers and JLL.

Nearby, 120 Spencer Street, owned by Anton Capital, is in due diligence for at least $250 million according to reports, in a deal brokered by CBRE.

Rip Curl Rides into Noosaville

International surfing retailer Rip Curl Australia is expanding its footprint on the Sunshine Coast by taking up a long-term lease at a major commercial site at Noosaville through Ray White Commercial Noosa & Sunshine Coast North.

Rip Curl has secured a 463 sqm tenancy at Lot 8, 18 Thomas Street, Noosaville, in a deal negotiated by John Petralia on behalf of a local investor.

Mr Petralia said Rip Curl would be moving into the former Network Video store in Thomas St.

“The international surfing retailer is making a major investment in Noosaville by securing a long-term lease in the old Network Video store at the home maker centre on Gibson Road,” he explained.

“Rip Curl is planning to open the new store with an action-packed event.”