$100M CAR PARK PORTFOLIO UP FOR GRABS
Written on the 2 September 2015
A STAGGERING 1000-plus car bays are up for grabs in Melbourne as part of a major property portfolio sale which could fetch more than $100 million.
"It is the biggest car park portfolio to be offered for sale in the Melbourne CBD for more than 10 years," says Colliers International's Matt Stagg.
"On its own, this portfolio is substantial and unique, but current market conditions elevate the offering to an unprecedented level."
Stagg and Colliers colleagues Daniel Wolman, Oliver Hay and Trent Hobart have been appointed to sell two major commercial car parks at 380-406 Queen Street in Melbourne and 16-32 Leicester Street in Carlton.
The Queen Street property is located on a 3218sqm site that is home to a six-level commercial car park comprising 556 bays, constructed in 1987. Situated in a high profile location on the corner of Queen Street and A'Beckett Street, it also includes a 1917sqm ground floor showroom and office.
The Leicester Street property is on a 2040sqm site comprising a six-level commercial car park with 454 bays, on the border of the Melbourne CBD.
"The sale of the two properties comes at a time when the number of purpose-built commercial car parks throughout the Melbourne CBD and city fringe is rapidly reducing," Stagg says.
"A number of parking facilities have recently been or are scheduled to be demolished to make way for new residential and commercial developments.
"Combined with a proposal by Melbourne City Council to limit on-street parking, this has seen the cost of car parking dramatically increase in recent years. Therefore, commercial car parks are a rare and highly prized investment that provide excellent cashflow."
Wolman said the properties are both situated within a rapidly developing education and lifestyle precinct, close to RMIT University and the University of Melbourne.
"The location also provides immediate access to other CBD amenities including the Queen Victoria Market and Melbourne Central," he says.
"The proximity of both sites to Queen Victoria Market, which is subject to a major revitalisation project being led by Melbourne City Council, would make the portfolio even more attractive to potential purchasers."
Melbourne City Council is currently seeking expressions of interest from private sector developers for the mixed-use development of the 'Munro site' directly adjoining the Queen Victoria Market.
In October 2013, the council announced the largest investment in its history to renew the Queen Victoria Market, and the vision to create one of the world's great market precincts.
"Both properties will be hotly contested by local and international investors and developers," Stagg says.
"These buyers will recognise both the significance of a commercial car park portfolio investment opportunity of this size plus the huge underlying land areas and future development potential.
"The flexible zoning will enable a number of major development outcomes to be explored, including residential, commercial, student accommodation, hotel and education, subject to approvals."
The car parks may be purchased as a portfolio or individually, with a total value of more than $100 million.
The Queen Street property is expected to attract interest in excess of $70 million, while Leicester Street is estimated to sell for around $40 million.
The properties are being markets through expressions of interest, which close on October 8.