International cosmetics brand secures one of last remaining floors at new office development.
Stamoulis Property Group’s new Collins Tower is almost sold out following a flurry of purchases in the first half of 2016.
International cosmetics brand MOR has snapped up some of the final available floors at the new Collins Tower at 580 Collins Street in one of the largest strata office sales in the Melbourne CBD to date this year.
Brokered by Colliers International’s Melbourne City Sales team of Chris Ling, Oliver Hay, David Sia and Daniel Wolman, the sale takes the development almost to completion, with only one floor still remaining. MOR has acquired several floors at the top of the Collins Street building for an estimated $5million.
Mr Ling said MOR had been looking for a prominent Collins Street address that would help the company establish a strong brand presence in the Melbourne CBD.
“MOR will join a mix of occupiers ranging from strategic business consultants, accountants and financial advisors at Collins Tower, where impressive sales results have reached as high as $8,600/sqm for brand new Collins Street offices,” Mr Ling said.
“This acquisition is another example of tenants taking advantage of the recent interest rate cut to enter the strata market.”
Mr Sia said MOR, recently purchased by a China-based group, saw an opportunity to invest capital in Australia, with Melbourne seen as a safe haven.
“The aim of this buyer group as a whole is to mitigate against volatility in their local economy, including the stock market and real estate,” he said. “Those offshore investors who have managed to move funds into Australia are increasingly motivated to secure commercial real estate within the Melbourne CBD.”
Mr Hay said Collins Tower was the newest strata office building in the Melbourne CBD, with a very slim supply pipeline in the future with only one floor left available.
“There are very few whole floor strata offices available within the CBD amidst heavy demand from a range of owner occupiers and investors,” Mr Hay said. “ We have seen many commercial buildings and sites developed into high rise residential apartment buildings, which further reduces the availability of prime CBD office space.
“This has had a positive impact on the value of prime strata buildings and the associated net rent that is being achieved. As a result, tenants are entering the market whilst landlords and owner occupiers continue to capitalise on unparalleled conditions.
“In terms of upcoming supply of office space in the Melbourne CBD, a significant amount of commercial space is due to hit the market in 2016, including about 9,700sqm in the Rialto redevelopment and around 54,000sqm at 447 Collins Street which is due to commence construction in the next 12 months. This is expected to ease but not eliminate some of the undersupply in the CBD.”
Mr Ling said the western core of the CBD had transformed over the past 24 months with the inclusion of Collins Tower at 580 Collins Street further connecting Victoria Harbour with the CBD.
“We have seen the national headquarters of major organisations including NAB, Myer and ANZ make the move to Victoria Harbour and are seeing a number of private and small businesses now following suit,” Mr Ling said.
“With the current development of 889 Collins Street by Lendlease, Victoria Harbour will continue to undergo a significant transformation and provide strong uplift in service, retail and commercial amenity.”
“Only two strata office projects on Collins Street have come to market this millennium, and Colliers International’s Melbourne City Sales team is proud to have been responsible for both 580 Collins Street and Lend Lease’s Lifestyle Working at 838 Collins Street which was completed in 2015 and 2013 respectively’ Ling said.