NEWS

Developer snaps up Glen Iris site as neighbours make most of demand

Colliers International sees momentum continue in suburbs as owners team up to list properties

Two homeowners in Glen Iris are the latest example of residential vendors in Melbourne’s suburbs teaming up to sell their properties to a developer.

Colliers International’s Ben Baines, Ted Dwyer and Hamish Burgess have sold two neighbouring properties at 1520 High Street and 65 Erica Avenue in Glen Iris as a 830sqm residential development site to a local developer for $3.4 million.

A growing number of residential vendors in Melbourne are banding together to put their properties to market conjunctionally as they look to capitalise on strong appetite for development sites.  Colliers International has witnessed firsthand a growing trend among property owners to create boutique, blue chip development sites by selling their neighbouring properties together.   Ben Baines, Colliers International Senior Executive – Investment Sales, the practice was becoming increasingly common following residential zoning reforms which were gazetted in July last year.The latest such property set to hit the market offers a combined corner site of around 830 sqm.   The properties at 1520 High Street and 65 Erica Avenue in Glen Iris are zoned General Residential Schedule 3, which could allow for multi-level residential development or alternative uses such as childcare.

1520 High Street and 65 Erica Avenue in Glen Iris

“This offering continued the widespread trend of multiple home owners putting their houses up for sale together as development sites,” Mr Baines said.

“The campaign was extremely well received with over 105 enquiries and numerous strong offers, which resulted in the property being sold only 24 hours after the EOI period closed. The eventual sale price resulted in a record land rate for the area of $4,096/sqm.

“Both owners received approximately 30% more through the process of selling to a developer than they would have done had they sold their houses individually.

“The exceptional interest and subsequent result is largely reflective of the large disparity between the median house price and median apartment price in Glen Iris."

Colliers International has seen a growing number of residential vendors in Melbourne banding together to put their properties to market conjunctionally as they look to capitalise on strong appetite for development sites.

“We have witnessed firsthand a growing trend among property owners to create boutique, blue chip development sites by selling their neighbouring properties together,” Mr Baines said. “The practice is becoming increasingly common following residential zoning reforms which were gazetted in July last year."

Nearby in Kew East, Colliers International’s Peter Bremner and Hamish Burgess have sold two neighbouring properties at 831-835 High Street to a Chinese developer.

As in Glen Iris, this 2,377sqm  residential development site consisted of two properties each with a residential dwelling on site, which were marketed together.

“Located just moments from the high profile intersection of Burke Road, High Street, Doncaster Road and Kilby Road in Kew East, this site was identified as suitable for a multi-level residential development given its zoning, slope and high profile location,” Mr Burgess said.

“A site feasibility study was prepared by Buchan Group Architects which provided for a three-level, 52 apartment development with basement parking."

Mr Burgess said after receiving in excess of 130 enquiries, the property was hotly contested by a number of parties and the price, whlilst undisclosed, was driven above expectations.

“This sale demonstrates not only the insatiable demand for well-located development sites at present but also the opportunity for existing home owners to capitalise on recent changes to residential zones and achieve premium sale prices by offering conjoined house blocks as larger development sites,” Mr Burgess said.

These two sales follow the acquisition of four side-by-side properties at 170-176 McKinnon Road in McKinnon by local developer Citiplan Property.

In this instance, Mr Burgess, Mr Bremner and colleague Andrew Ryan assisted four separate owners in joining forces to sell their properties for $4.18 million.

“This unique opportunity to acquire four houses in one line along McKinnon Road provided residential developers with an unparalleled opportunity to secure a significant landholding in a premium location.

“The site was zoned General Residential and as such, three levels would be achievable (STPA). Throughout the campaign buyers indicated a strong belief that the sites could yield approximately 30 apartments.

“Throughout the campaign there was a phenomenal amount of enquiry that resulted in a highly competitive process. Local, national and off-shore developers were drawn to the property because of the favourable location and amenity right on the property’s door step. Buyer and vendors were ecstatic with the result."

Mr Baines said agents were also seeing an increase in activity from Asian buyers in Melbourne’s metropolitan market as this buyer group began to look outside the CBD. He said around 70% of enquiries for this kind of property with development potential was now coming from offshore groups.

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