Colliers International sells Berth restaurant in sale and leaseback deal
A prominent waterfront restaurant in Docklands has been snapped up as a trophy purchase by a local Asian investor in a significant sale and leaseback deal negotiated by Colliers International.
Colliers International’s Guy Wells, Daniel Wolman and Oliver Hay have facilitated the sale of the Berth restaurant premises, Icon Building No. 1, at 45 Newquay Promenade. The deal was negotiated at a sub-7% yield.
Situated on the southern side of Newquay Promenade, the iconic 515sqm building is constructed over the waterfront within the Newquay precinct of Docklands, an extension of the Melbourne CBD.
The property was constructed on Crown land and is subject to a long term Crown Lease to 2101. The Crown Lease commenced on 19 November 2002 and is for a 99 year term.
“Somewhat unique in the Melbourne property market, this allowed the construction of the building to be undertaken over the waterfront to create this exceptional offering,” Mr Wells said.
“While the Newquay area has had its challenges, iconic buildings with strong tenants are highly regarded and sought-after by investors. This is a shining example of this kind of property – a real trophy asset for an investor, with its secure, long term lease to a highly regarded and experienced restaurateur, Berth Restaurant Pty Ltd.
“Berth has been in operation for more than 10 years in Docklands, with a further 10 year lease plus options.
“The building itself was developed as an iconic draw card to the Docklands precinct, a state-of-the-art hospitality venue with floor-to-ceiling glass windows overhanging the waterfront. The property is one of only two such rare premises constructed within Melbourne, if not Australia, and has uninterrupted views across Melbourne and the Yarra River."
Mr Wolman said Docklands had become home to some of the largest corporations in the country including ANZ, Myer, NAB and Lend Lease.
“In addition, it is now full of pre-committed tenants which results in a greater need for small businesses in the Docklands and thus increased amounts of foot traffic,” he said.
The area was also known for its tourism and entertainment activities including Etihad Stadium, Waterfront City, the Melbourne Star Observation Wheel and Harbour Town Shopping Centre. The precinct also holds a variety of events including fireworks on Australia Day and New Year’s Eve and has easy access to Southern Cross Stadium and CityLink.
“Drawn to this unique combination of retail, cosmopolitan lifestyle and water views offered by the Yarra River, investors are turning their attention to Docklands to meet the strong interest from tenants wanting to be in the area,” Mr Wolman said.
“Development in the Docklands region began circa 2000 and since that time almost $9 billion worth of development has occurred. This includes more than $2.4 billion worth of private development in 2011-12 which occurred across 16 projects totalling 350,000sqm of gross floor area, including about 1,500 residential apartments."
In addition, there was a further $8.5 billion of development under construction, with 5,400 residential dwellings built or under construction. There were currently more than 7,000 residents and more than 29,000 workers based in the area. On completion, in around 2025, the Docklands precinct was expected to have 12,000 dwellings housing approximately 20,000 residents and over 60,000 workers.
“As the precinct grows, so does the strength of the most iconic building within the precinct. Given its location and views across the waterfront and Melbourne CBD, Icon Building No. 1 will continue to be one of the most sought after and impressive restaurant properties in Melbourne.”