Melbourne’s prime shopping strip market is set for another major test, with a powerhouse trophy investment in the heart of tightly-held Carlisle Street, Balaclava going to auction in September.
Fitzroys’ Chris Kombi, Tom Fisher and Ben Liu are marketing 282-284 Carlisle Street, Balaclava, which will be auction on Wednesday, 18 September at 1pm.
Expectations are of $3.7 million-plus.
The immaculate 325sqm double-storey corner freehold is leased to Australian hospitality heavyweight Commune Group, which operates Moonhouse from the property, following on from its renowned venues Firebird, New Quarter, Tokyo Tina, Studio Amaro, Hanoi Hannah Vol. II and Express Lane.
Commune Group has a secure lease of 10 years and eight months from February 2021 over the property, with 5+5-year options, currently returning $180,300 per annum plus GST.
The property is on an extensive 334sqm corner landholding in the absolute heart of Carlisle Street, with an extensive frontage of 43 metres, while highly desirable Commercial 1 zoning offers a range of future potential value-add.
“This is a very rare opportunity to secure one of Carlisle Street’s most coveted properties. This high-profile corner freehold is an excellent set-and-forget investment, ideal for investors and landbankers alike,” Kombi said.
“Investors can lock away a powerhouse trophy investment with a strong, secure cash flow from a renowned tenant, and the fully-renovated nature means no capital expenditure is required,” he said.
“Well-located Melbourne shopping strip assets with long leases to quality tenants offer an excellent investment option at a time of share market and residential market volatility.
“Land bankers can enjoy the strong income stream over a number of years and assess their options for a site that is in the absolute heart of one of a vibrant Melbourne shopping strips.”
According to Fitzroys’ Walk the Strip series, Carlisle Street, Balaclava recorded another tightening in its single-digit vacancies in the past year, as Coles and Woolworths supermarkets and a cosmopolitan offering of cafés, bakeries, eateries and bars continued to draw visitors from its loyal local catchment and the surrounding southside suburbs.
The heart of Carlisle Street is potentially in line for a major refresh in the coming years, also. Coles has just bought its own supermarket building and surrounding shops fronting Carlisle Street, which together are likely to be part of a retail precinct redevelopment.
“Carlisle Street is supported by excellent existing demographic fundamentals with a mix of white collar professionals, students and families driving activity, and the spending power of the residential and worker catchment is being boosted by an increase in multi-storey apartment and commercial development activity,” Fisher said.
This includes the new Open Court on William Street, which is bringing nearly 6,000sqm of office space to the precinct.
“There are a number of Melbourne shopping strips experiencing a period of renewal. Developments on and around the strips are underpinning future trade and rent prospects,” he said.
Liu said Carlisle Street’s accessibility to public transport via Balaclava Station and the Route 3 and Route 16 trams, and major roadways such as Nepean Highway, Dandenong Road, Beach Road and Hotham Street, encourages patronage from all across metropolitan Melbourne, as well as attracting more residents and workers to the area.