Pace Developments to divest new 30m state-of-the-art office
Pace Developments to divest new $30m state-of-the-art office
| 30 September 2019
CBRE Melbourne’s Middle Markets team is bringing to market a new freehold office building in one of Australia’s most vibrant office markets, with price expectations of around $30 million.
Private developer and builder Pace Development Group, led by Shane Wilkinson, anticipates the 3,082sqm property, which is currently under construction, will be due for practical completion before the end of 2019.
The Melbourne city fringe property will comprise 11 levels of high-quality, light-filled office accommodation with a ground floor café, end-of-trip facilities, communal areas and 17 secure basement car parks.
Located circa 1.5km from the CBD, the property is surrounded by popular amenities, including services, hospitality and public transport options.
CBRE Director Scott Orchard said the asset represented an outstanding opportunity for investors to secure a premium, defensive office product coffering attractive depreciation benefits.
“The design of the property has been shaped by strong occupier demand for smaller format, whole floor accommodation, which offer strong prospects for future rental growth given the strategic proximity to the Melbourne CBD,” Mr Orchard said.
The building’s total annual income is projected to be $1,600,000 net, with an average lease profile of six years.
There are 11 tenancies with agreements for lease on the majority of the building and strong interest on the few remaining tenancies with five-year rent guarantees on offer.
Pace Development Group recently delivered ‘Pace of Collingwood’ – a nine-storey apartment building diagonally opposite 51 Langridge Street, consisting of 79 apartments on the former Smith Family Head office site.
“Pace has been actively building and developing in the Collingwood and City of Yarra market for a number of years and has seen Collingwood continue to explode in popularity and strengthen as a diversified commercial, retail and domestic market where people want to live, work and play,” Mr Wilkinson said.
“Given the past take up of new residential product which has seen many developments be completed recently, comes a growing demand for modern office accommodation – Our team has recognised a sweet spot for smaller to medium sized tenancy offerings which has seen this development thrive,” he continued.
“In addition to the quality, high specification and standard of finish, the building has many cutting-edge design features by SJB Architects and Interiors, which will differentiate it in the market – ensuring ongoing tenant appeal,” Mr Wilkinson added.
CBRE Director Josh Rutman said; “Rarely does the market see an offering that embodies a combination of the hottest product, in the hottest location, in the most hotly contested and spoken about market sector, with office in vogue all around the country.”
“The full floor tenancies maximise the building’s net floor area and, in turn, income ability – offering a clever, diversified income strategy and ensuring the building does not need to rely on a big pre-commitment to underpin construction,” Mr Rutman added.
The CBRE Expressions of Interest Sales Campaign concludes on Thursday 31st October at 1pm.
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CBRE Group, Inc. (NYSE:CBRE), a Fortune 500 and S&P 500 company headquartered in Los Angeles, is the world’s largest commercial real estate services and investment firm (based on 2018 revenue). The company has more than 90,000 employees (excluding affiliates) and serves real estate investors and occupiers through more than 480 offices (excluding affiliates) worldwide. CBRE offers a broad range of integrated services, including facilities, transaction and project management; property management; investment management; appraisal and valuation; property leasing; strategic consulting; property sales; mortgage services and development services. Please visit our website at www.cbre.com.