June Quarter 2019 Commercial Real Estate Update
Research from Core logic shows Melbourne commercial property sales has significantly increased in the past three months, and the trend is expected to continue.
Recorded sales in the quarter ending June 2019 were 3x higher than the previous quarter ending March 2019 with $1.897 billion in sales compared to $615.4 million and $621.5 million in sales recorded in the three months ending December 2018.
The higher total sales number last quarter was due in most part to the sale of 80 Collins Street, Melbourne the new 40-storey South Tower consisting of 43,000m2 of office space and the refurbishment of the existing North Tower, which will include a new lobby, food court and business lounge as well as the new Next hotel located on Lt Collins Street.
As a result, the 12-month total commercial real estate sales from 214 sales was $3.686 billion, a significant increase compared to the previous 12-months total, which was from 273 sales and amounted to $3.077 billion.
The table below indicates the sales recorded from the past eight updates of Melbourne Cityscope
Notable sales in the last quarter:
– Invicta House at 226-232 Flinders Lane, Melbourne, an 8-storey office building including a basement, with a gross building area of 4,832 sqm on a site of 741 sqm, which sold for $45 million.
– 31 Queen Street, Melbourne, a 22-level office building plus five levels of basement parking for 172 cars, with a net lettable office area of 19,213 sqm, which was sold for $200 million
– 80 Collins Street, Melbourne
As we can see from the graph above, even though the total number of sales are decreasing, but the overall value of the properties that were sold was significantly higher that enabled Melbourne’s commercial real estate market to reach bigger returns even with smaller sales.
With prices remain strong and sustainable demand, the commercial real estate market is forecasted to remain a strong section of Melbourne’s real estate market and will continue to grow even further.
At Xynergy Commercial, our team of consultants keeps up with the latest market trends to be able to provide the most optimal outcome for our clients.
For more information regarding the Melbourne Commercial property market, contact our office on (03) 9676 9411 or stop by for a visit at Suite 411/434 St Kilda Rd, Melbourne VIC 3004.
Published by Xynergy Commercial, 2019 – Melbourne Commercial Real Estate Agency