International and Fitzroys list passive commercial investment asset in tightly
held headquarters precinct
A securely tenanted office building at Tally Ho Business Park in Melbourne’s east has hit the market this week, at a time when investors are scrambling for passive investment opportunities.
Colliers International’s Peter Bremner and Rob Joyes, in conjunction with Fitzroys’ Paul Burns and Michael Ryan, have been appointed to the expressions-of-interest campaign for 10 Wesley Court, Burwood East, the long-time Australian headquarters of global corporation Motorola Solutions.
The four-level, 4998sqm building, one of 17 office buildings at Tally Ho Business Park, was purpose-built for Motorola. The telecommunications equipment provider leases every level of the building, sharing the top office floor with The Salvation Army.
“This is a modern passive commercial investment opportunity with secure leases to two high-calibre tenants,” Mr Bremner said. “Motorola has occupied this building since its construction in 2000 and has invested heavily in the facility’s amenity in that time."
Mr Burns said the site posed significant value for money and rent reversion potential, with the secure tenancies promising sustainable cash flow.
“Both Motorola and The Salvation Army are paying a low rent on a dollar-per-square-metre basis compared to surrounding tenants,” he said. “When compared to city-fringe and inner-east suburbs, the expected sale price will show a compellingly low capital value rate per square metre and also a higher yield."
The tenants combined pay a net annual income of $1.363million per annum, with a Weighted Average Lease Expiry of about four years.
A sleek, corporate-style building with a glass-curtain façade and glass internal staircase, 10 Wesley Court is considered the premier office building within the Tally Ho Business Park.
“The building presents immaculately with very little capital expenditure required,” Mr Joyes said. “Since its construction, it has never advertised any vacant space, which is a testament to the current long-term tenants and the suitability of the building to tenants’ needs."
The large land holding measures about 8444.5sqm, with two access points and parking for 218 cars.
“Given the flexible Commercial 1 zoning and significant land parcel, the future redevelopment prospects at this versatile property are significantly enhanced,” Mr Burns said. “Whilst it is an excellent investment now, it has the attributes of a ‘land bank’, which may accommodate an alternative use – potentially medium-density residential – in the future."
Tally Ho Business Park is situated on the corner of Burwood Highway and Springvale Road in Burwood East, about 18 kilometres east of the CBD. It is considered an important business headquarters and emergency services precinct, with Victorian government statutory authorities, including the CFA and Ambulance Victoria, occupying about 22,000sqm of the total office supply of about 80,000sqm.
Many of the emergency services organisations at Tally Ho Business Park provide direct services to each other, highlighting the strong probability they will continue as long-term occupiers into the future.
“It is important that Motorola remains at Tally Ho, as several of its clients are also stationed there, such as the Emergency Services Telecommunications Authority,” Mr Bremner said.
Other long-term, high-profile tenants of Tally Ho Business Park and nearby include Hewlett Packard, World Vision, National Archives, Pronto Software, IAG Insurance, ANZ Bank and Yokogawa.
Expressions of interest close in December. For more information, please contact Mr Bremner on 0412 326 942 or Mr Burns on 0412 244 274.