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Insto pays $14m for Flight Centre, Brookfield Multiplex home

Property Markets / Transactions

Australia / Melbourne

Sep 10 2018

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Flight Centre and Brookfield Multiplex will get their second new landlord in three years following the sale of their Little Collins Street home to an institutional investor for $14.05 million on a sharp 2.8 per cent yield.

The 362 Little Collins Street property which had, prior to the current vendor, belonged to Crazy John Ilhan’s widow Patricia, previously sold in 2015 for $9.5 million.

Teska Carson Director, Michael Ludski, who brokered the deal, said the marketing campaign had attracted 80 enquiries from local, interstate and offshore interests and sold after the second round of an EOI process.

He said the price reflected the limited CBD opportunities for investment in the sub $15 million market while the potential to add additional floors to the building had also been important in the property’s appeal to a wider range of buyers.

``The fact that there are currently few opportunities for investors in the CBD under $15 million was a key factor in attracting such a strong field of purchasers.

``Melbourne’s strong office market with its sub 5 per cent vacancy rate and growing tenant demand, the blue chip tenancy profile, and the property’s exceptional potential for development and capital growth in arguably Melbourne’s most famous and popular laneway, were also important attributes,’’ Mr Ludski said.

He said he expected to see continued downward pressure on yields as more positive market indicators – particularly rental growth and falling vacancy - drive greater demand for limited supply.

The 362 Little Collins Street building, which was sold fully refurbished in 2015, comprises four levels over 950 square metres (NLA) with ground floor retail and three office levels above, on a 312 square metre, Capital City One zoned site, with eight metres street frontage. 

Located near the corner of Elizabeth Street, in the heart of the financial precinct, the building is fully leased to Flight Centre and Brookfield Multiplex, among others, returning $396,000 per annum net.



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