Carlisle St 281-289

The sale price of a major commercial building in the Balaclava retail strip has soared close to $18.5 million, just a year after it was acquired for $12.5 million.

The new deal represents a 30 per cent increase in value for Carlisle Corner (previously known as Beller House), a two and three level retail and office building at 281A-289 Carlisle Street that was built in 1973.

The deal was negotiated by agents Michael Gross and Mark Wizel from agencies Gross Waddell and CBRE, who were unavailable
for comment. It is understood the buyer is a private local family who outbid a handful of other potential buyers, including overseas parties. Title deeds show the vendor bought the property in October 2014.

The intensity of competition for properties in the CBD between institutions and overseas capital has pushed private family wealth further into the suburbs.

Balaclava is eight kilometres south east of the city in the heart of Melbourne’s Jewish community. The area is undergoing gentrification and an apartment building boom, with several projects in the area at four and five levels in height.

It is not known if the new owner is planning to develop the property, which is zoned Commercial 1, or retain it as an investment.

The building sold on a yield of 5 per cent. It has 16 tenants, including a gym and three medical businesses which pay a current net income of $907,535. Fully leased, it would earn $962,804.

All leases are set to expire in 2020, according to the information memorandum provided in the expressions of interest sales campaign.

The 3500-square metre building is on a 2720-square metre parcel of land on the corner of Carlisle Avenue at the entrance to the vibrant Balaclava retail strip. The price represents $6800 a square metre in land value, one of the highest prices paid for the area.

 

The Age – Published 28 October, 2015.