Melbourne, 23 January 2014 –The consortium of developers behind Southbank tower Australia 108 can confirm that the project site has been sold to Singaporean property developer World Class Land Pte Ltd, a subsidiary of Aspial Corporation Ltd.
The sale price was $42,300,000 (plus GST) with contracts exchanged just prior to Christmas. The deal received FIRB approval on 20th January, and settlement will take place on 24th March 2014.
The Australia 108 consortium includes Nonda Katsalidis, whose firm Fender Katsalidis designed the tower; investor Adrian Valmorbida; developer Benni Aroni representing the Watersun syndicate made up of himself, Gary Caulfield, Rob Elliott and others; and the Beulah International syndicate representing the Malaysian partners. Katsalidis and Aroni were also two of the developers of Eureka Tower.
Preparatory work on Australia 108, located 200m from Eureka Tower, had been rapidly gaining momentum with a large team of consultants engaged in various planning, design and marketing activities. An Expression Of Interest campaign concluded in December 2013 for international operators for the hotel incorporated into Australia 108, was in the process of being assessed by the group’s hotel consultancy firm.
“Contrary to previous inaccurate media reports, the site was not on the market formally or informally”, said Benni Aroni, Developer’s Representative for Australia 108. “Interest in Australia 108 from potential apartment purchasers and hotel owners and operators has remained consistently strong”, he added.
“Late in December, several unexpected approaches to purchase the site were made to me from both local and international companies, and ultimately an offer was received which was attractive enough for us to consider selling the site. It all happened very, very quickly, and was subject to confidentiality clauses, so we were not able to disclose the sale to anyone, until now”, said Mr Aroni.
The sale was negotiated by selling agents Mark Wizel and Josh Rutman, of CBRE Melbourne City Sales, who acted for the vendors. “The sale of 70 Southbank Boulevard is a landmark transaction as it demonstrates that the interest from Asian-based developers in Melbourne opportunities is widening beyond the traditional confines of the CBD”, Mr Wizel said.
“Several major site transactions were negotiated in 2013 on the city fringe which represent the maturity of the Melbourne apartment market and the confidence that active, offshore-based developers now have in projects in non-CBD locations,” he added.
Wee Seng Koh, CEO of Aspial Corp Ltd said “We are very pleased with our purchase of this premium site, which adds to the development portfolio in Australia we have already acquired. We plan to continue to develop Australia 108 as Melbourne’s tallest and most significant residential and commercial tower, with a launch planned for 2014.”
People who have registered their interest in an Australia 108 apartment will be contacted with an update on designs for the tower once plans are further advanced.
CBRE’s Overview of Southbank Commercial Property
Offshore interest in Melbourne development opportunities remained strong in 2013 with an estimated $688 million in development sites changing hands, predominantly to listed Malaysian and Singaporean developers. This included a previous Aspial Corp Ltd purchase of an office building at 383 King Street with major development potential, as well as multiple acquisitions by Singapore’s Hiap Hoe and a $65.65 million first time purchase by UEM, one of Malaysia's largest developers.
Local developers have also started to weigh back into the market, with this expected to further increase the confidence of offshore buyers in Melbourne development opportunities.
The improved funding environment combined with continued strong sales of off-the-plan units has reinvigorated both traditional and new local players, who have active requirements for both CBD and city fringe development sites.
The sale of 70 Southbank Boulevard follows a spate of development site transactions in Southbank including the recent sale of the well-known Hannover House building at 158 City Road which was sold by prominent businessman Sam Alter for $22,500,000 to a new mainland Chinese developer. The sale reflected a land rate of over $17,000 per square metre, further demonstrating the growing land values being achieved in Southbank in 2013 and early 2014.
Private investor Sam Suleman also recently offloaded a nearby site at 25 Queensbridge Street opposite Crown Casino for $31,000,000 with Australand also selling its last remaining holding at 38 Freshwater Place for $30,000,000 to prominent Malaysian hotel developer Michael Kum.
“These recent sales are a clear illustration of the depth of interest in these Southbank sites, with purchasers originating from Malaysia, Singapore, mainland China as well locally based developers,” Mr Wizel said.
More Information or interviews
Lisa Chapman
Marketing and Communications Manager, Australia 108
0419 368 031 or lisa@australia108.com.au
Mark Wizel
Director
CBRE Melbourne City Sales & Victorian Retail Investment Properties
+61 411 694 756 or mark.wizel@cbre.com.au
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