Melbourne's iconic Hoyts Cinema building is set to hit the market this week.
Colliers International’s Daniel Wolman and Oliver Hay expect 140 Bourke Street will attract substantial interest, particularly from overseas investors.
The property is a prime strata office building at the east end of the Melbourne CBD, comprising a Virgin Active gym on the ground floor and a 300sqm, refurbished floor of top quality strata office on Level 1 with full amenities, including a 300 sqm terrace and four secure car spaces.
“With interest rates at an all-time low, the demand from investors looking to buy an office rather than lease is extremely strong,” Mr Wolman said.
“Office owners are finding it easier to pay off their mortgages quickly and can see the added value in capital appreciation of CBD strata offices. Commercial CBD real estate values have never increased more quickly, which is giving confidence to investors to change their business model and purchase rather than lease.
“Through our work in Asia, we have found that a crucial requirement for Asian developers is to own an impressive CBD office in Melbourne with a large balcony area in a prime position.
“Not only is this property well exposed at the east end of Bourke Street, Level 1 is the only floor in this building with the unique offering of a 300sqm exclusive outdoor terrace. The terrace itself is something special and creates a vibrant environment for employees.
“On our latest visit to Hong Kong, Shanghai and Singapore, we received a consistent message from investors – this is just the beginning of this so called ‘property boom’ and we can expect much more capital to be invested into Australia over the next few years for all types of quality property.”
Mr Hay said the four secure car spaces were a significant addition to the asset.
“With the ongoing construction of apartments in the CBD, public car parking will become harder to secure,” he said. “Private car spaces are rapidly increasing in value, with many spaces now selling for well over $120,000 per bay. Having four car spaces included in the offering truly does add a large monetary value to the investment.
“Given the comfortable entry level price point and strong current market conditions, it will be interesting to see the local and offshore investors fight off for what we see as the most unique strata office floor in the Melbourne CBD.”