New price benchmark set for St Kilda Road: Beville Property Group has offloaded the nine-level 509 St Kilda Road office tower for $163 million to private investor Michael Xie, with the transaction setting a new sale price record for the inner-city boulevard.
The 19,506sqm tower counts the federal government, Fuji Xerox and life insurer AIA among its tenants, and is on a 6,070sqm block opposite Fawkner Park.
It traded at a 4.96% yield, and the significant uplift in value – Beville bought the tower for circa $90 million just four years ago – is the latest reflection of the precinct’s popularity among local and offshore investors.
Several groups have turned sizable profits in string of transactions stretching back to the latter part of 2017. A syndicate overseen by Newmark Capital sold the 19,500sqm A-grade tower a 417 St Kilda Road one year ago for the previous record price of $144.4 million, to Singaporean fund manager Mapletree, having paid $64 million five years earlier for the building.
Perth based syndicate Lester Group sold 324 St Kilda Road for $42 million, four years after paying $22 million for it. That followed Chip Eng Seng selling the 11-storey, 10,459sqm building at number 420 for $68.84 million, some $23.56 million more than its 2013 acquisition price, while Lian Beng Group and KSH Holdings fetched $34 million for number 596, less than two years after they paid $25 million.
Other sales have included a joint venture between Roxy-Pacific and Tong Eng Group’s Teo Tong Lim acquiring 312 St Kilda Road from the Myer family for almost $77 million, and more recently, Abacus and Wing Tai teamed up to take 464 St Kilda Road for $95.38 million.
Disclosure: The weekly Fitzroys Property Wrap is for information only on transactions in the Melbourne property market. Fitzroys provides this information as a public service. We are not purporting that all sales and leases within this report were transacted by Fitzroys.