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Aurora Melbourne Central strata office collection sold out on back of limited CBD supply

Colliers International sells 18 strata offices on behalf of UEM Sunrise

A limited supply of new strata office space in the Melbourne CBD has seen a wide range of buyers snap up the remaining suites at UEM Sunrise’s Aurora Melbourne Central.

Colliers International’s Chris Ling, Anthony Kirwan and Oliver Hay have successfully sold all 18 suites making up the commercial office component of the high profile mixed use project at 224-252 La Trobe Street in Melbourne. 

The 18 suites represent 3,100sqm of office space from Level 1 to Level 7 and have been acquired by a wide range of buyers over the past 12 months, for a total realisation exceeding $31 million. 

Mr Ling said the strong demand had been fuelled by minimal supply.

“There is currently no confirmed strata office development pipeline in the Melbourne CBD, which has meant this premium project in a first class location – with a direct connect to Melbourne Central – has been highly sought,” he said. 

“The sale of these 18 ‘cold shell’ offices have set a new benchmark in the Melbourne CBD office market. There has been a strong representation of all buyer types including SMSFs, future owner-occupiers, local and offshore investors and private syndicates and funds.”

The suites ranged from 171sqm to 415sqm and from $1.65million to $4.027million in sale price, with an average rate over $10,000sqm.

The offices will be located on the podium levels of a 92-storey residential, serviced apartment and retail tower facing La Trobe Street and Little La Trobe Street in the heart of Melbourne’s business and financial centre. 

Mr Kirwan said the Melbourne strata office market had experienced an increase in investor demand in 2018; with buyers attracted to the positively geared returns and low vacancy rate.

“Buyers are willing to pay premium prices to secure CBD strata-titled assets and capitalise on the low interest rate environment,” he said. “We received 338 registered buyer enquiries for Aurora, showcasing the enormous depth and demand for strata office stock in the CBD.”
Mr Ling said there had been a shift in developer focus from residential to strata office projects in 2018, with restrictions on foreign purchasers and added acquisition costs having an impact on residential sales and projects.

“The funding of residential sites seems to have become slightly more difficult and strata office is a viable alternative option for conversion,” he said. “Planning is in favour and this is encouraging for new office developments in inner Melbourne.”
 

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