Melbourne, 2 July 2014 – In another vote of confidence in the Melbourne office market, local syndicator Vantage Property Investments has purchased 11 Queens Road for $27 million.
CBRE’s Kiran Pillai and Mark Coster negotiated the off market deal on behalf of Denison Funds Management.
Mr Pillai said the sale of the prominent Queens Road office building confirmed the continued strength in investor interest in Melbourne, with the sale price representing a rate over the total building area of approximately $3,066/sqm.
The property comprises 8,806sqm of net lettable area across 11 levels, each providing flexible, efficient floor plates with excellent natural light and views.
“The property’s prominent location at the preferred city end of the St Kilda Road precinct was a major factor behind the buyer’s interest in the building. The location and outstanding views across Albert Park Lake and Port Phillip Bay will set the tone to push the rental profile and drive returns from the building moving forward.”
Denison Funds Management CEO, Matthew Burrows said: “The sale of 11 Queens Road Melbourne is a positive move for the Denison Diversified Property Fund, improving debt position and Fund value. Since taking over management of the Fund in June 2012 Denison has strived to improve asset values and restore fund value. The sale of 11 Queens at $27.0 million demonstrates a significant value uplift as a result of Denison’s active leasing and management.”
Vantage Property Investments is a boutique property fund manager specialising in the acquisition and management of commercial property on behalf of high net worth private and institutional investors. Vantage Director Hamish de Crespigny said: “Competition in the current market has resulted in assets trading at prices we are not comfortable competing with. Given its management intensive nature, an asset like 11 Queens Road Melbourne allows us to leverage our skill set in refurbishing and improving the tenancy profile of assets to the benefit of our investors”
Mr Coster said the St Kilda Road precinct was benefitting from the withdrawal of a number of smaller B Grade assets for residential use.
“We’re forecasting approximately 90,000sqm of withdrawals over the short to medium term for residential conversions, meaning that sitting tenants will need to review their options,” Mr Coster said.
“Buildings such as 11 Queens Road that offer excellent access and affordable office accommodation will be on the radar as a result.”
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