Colliers International’s Melbourne Capital Markets team has brokered the sale of 75 Dorcas Street in South Melbourne for $166million to Growthpoint Properties Australia.
It is the second major sale over $100million to be conducted outside of the Melbourne CBD in 2016, following the sale of the Como Centre on Chapel Street for $236.5million. Both deals were negotiated by Colliers International’s Nick Rathgeber and Leigh Melbourne.
75 Dorcas Street is an 11-level campus-style office building of 23,811sqm, completed in 2002. Fully leased to seven tenants including ANZ, BMW and Mondelez, the building offered a five year WALE.
The sale price of $166million represented an initial yield of 6.6% and a capital value of $6,972/sqm, including a 690-bay commercial car park.
“Buyers were attracted to the enhanced yield on offer beyond that which is available in the CBD,” Mr Rathgeber said. “Three out of the four final bidders were backed largely by offshore capital sources, including South Africa, Singapore and Germany."
Mr Melbourne said buyers were also attracted to the building’s strong tenancy profile, compelling retention history and renewal outlook.
The property, also known as 209 Kings Way, is the seventh major Melbourne office investment acquired by an investor backed predominantly by offshore capital in the past 12 months. Five of these seven transactions, totalling $1.28billion, have been brokered by Colliers International.