Bubble Tea Demand Spills Over Across Melbourne’s CBD
Demand from bubble tea traders seeking retail space is spilling over across the city, as The Alley LuJiaoXiang moves to open its second CBD site, on busy Elizabeth Street.
Fitzroys Associate Alex Shumnegotiated the 5+5-year lease for 103 Elizabeth Street at $200,000pa, on behalf of a private investor. The rental rate reflected $2,667/sqm for the 75sqm space.
The Alley LuJiaoXiang operates within QV Melbourne on Lonsdale Street, as well as at Highpoint Shopping Centre in Maribyrnong.
It will be moving into the space formerly occupied by Subway, marking another step in the retail refocus occurring along Elizabeth Street.
“The bubble tea phenomenon has been driven by the increasing number of international students in Melbourne, which has boosted pedestrian traffic as well as the immediate population across a string of new student accommodation and high-density residential developments,” Shum said.
“Demand from Asia-based and Asian cuisine food and beverage operators is currently reshaping the retail landscape across the north of Melbourne’s CBD, and we are seeing this spill over across the rest of the city.
“That demand is translating to an uplift of rents in new CBD retail precincts, and a generational shift in tenancy mix.”
Shum recently leased the 50sqm space at 59 Elizabeth Street, closer to Flinders Street Station, to international chain Gotcha Tea at $165,000pa net.
Further north in the CBD, Shum leased 299 Elizabeth Street to another international bubble tea brand, Prime’s Hai at a record rate for the area of $3,150/sqm.
Shum and Fitzroys colleague Terence Yeh also leased the former Spot On Motorcycles building at 423-425 Elizabeth Street to Hong Kong dessert house chain Hui Lau Shan at a precinct record $400,000pa net.
Shum has just negotiated a 5+5-year deal lease over the 50sqm space at 339 Swanston Street to an Asia-based food and beverage operator at $300,000pa net, at another precinct record of $6,000/sqm. The operator will take the place of Student Flights.
More Eastern Suburbs Office Sales
Long Yang Holdings has paid $11 million for the 19 Shierlaw Avenue office building in Canterbury, at a 5.3% yield.
Fully leased to three tenants, including Townshend Contract Builders, Price Gibson and Scientific Management Associates, the three-level, 1,861sqm building has basement parking for 40 cars and returns $592,795pa.
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. Terms/Privacy © Copyright 2019 Fitzroys.