Hengyi Pays $17m for Mornington Peninsula Site

Melbourne-based developer Hengyi has purchased the former Mt Eliza hospital site on the Mornington Peninsula, one of the largest individual landholdings in the area.

The $17 million-plus sale price paid for the 3.4 hectare site was lower than anticipated when the beachfront site was last on the market in March 2017.

The property is located close to several other properties recently transacted, including Moondah Estate, which sold to Ryman Healthcare for $37.5 million and Morningstar Estate – a 63ha property which transacted for over $36 million.

It is thought strict heritage and regulatory requirements and a weakening property market reduced demand for the general residential 1 zone site.

“We are acutely aware of the rather unique aspect of the location on the Golden Mile and its heritage status,” Hengyi general manager Simon Manley said.

“There are few sites quite like this one and we want to make sure that our development is both sensitive and respectful of its surroundings and the environment.”

The property was initially developed from the late nineteenth century as the private residence Beachleigh, later becoming home to the Orthopaedic Branch of the Royal Children’s Hospital, before being used for aged care and, more recently, administrative purposes.

The site, zoned general residential, has 198 metres of frontage to Jacksons Road and 200 metres foreshore frontage.

The property could now potentially either be subdivided into luxury residential lots or high-end retirement living as well as hotel accommodation or a medical facility, subject to council approvals.

“We don't have a set idea at the moment, and of course we will need to work with zoning and site restrictions, but we are excited about delivering a very special, high end, product to the local community,” Manley said.

The site and its surroundings have improved access via the $759 million Peninsula Link project which opened in 2013, allowing motorists for the first time to drive from Melbourne to Rosebud without encountering a single traffic light.

Chinese-backed Hengyi recently completed its Swanston Central tower in Carlton.

Hengyi acquired the site from Melbourne-based Grocon Group back in 2015 for $64.8 million. Residents have moved into the 1,045 apartments in the 70-storey Elenberg Fraser-designed tower.

The 2,500sq m retail space is in the historic bluestone offices that date back to 1868. Carlton and United Breweries once ran its massive and growing beer empire out of the building.