Malaysian developer SP Setia has purchased one of the last remaining permit-approved sites in the Melbourne CBD’s northern end for $61 million.
The 1,741 square metre property located at 111,125 A’Beckett Street – known as Paradigm - has been earmarked for a 210-metre residential tower, accommodating 632 apartments and ground floor retail.
The property currently houses a Harley-Davidson dealership.
CBRE’s Josh Rutman, Mark Wizel and Lewis Tong managed the sale process on behalf of Singaporean developer, Tong Eng Group.
Tong Eng Group Director Emilia Teo said the transaction reflected the strong appetite for well-designed residential assets in the Melbourne CBD.
The site, which currently houses a high profile dealership for Harley-Davidson, had an approved permit for a 210 metre-tall ‘bow-shaped’ residential high-rise tower, which allowed for potential developments double what is currently permitted in Melbourne, who's plot ratio is 18:1.
According to CBRE, the approved permit was for 632 one, two and three bedroom apartments, as well as 5 retail tenancies over the bottom three floors. The front of the development will also retain the external façade of the art deco Commonwealth Motors building.
CBRE Melbourne City Sales Director Josh Rutman said the sale of 111-125 A’Beckett Street was a clear example of how established local and offshore developers continue to exhibit resilient demand in Melbourne, despite headwinds such as funding restrictions and regulatory changes.
Mr Rutman said the sale of 111-125 A’Beckett Street reflected $35,037 per square metre, which was the highest land rate for a Melbourne residential site of more than 1000 square metres.
"We are extremely satisfied with the sale of 111-125 A’Beckett Street, which delivers an attractive return on investment for the group," Ms Teo said.
CBRE National Director Mark Wizel said the sale represented a 37.3% increase on the 24-month average per square metre land rate of $25,525 for sites sold in the CBD.
The purchase will mark SP Setia’s sixth development in its Melbourne portfolio, with other projects including Fulton Lane at 151-165 Franklin Street, Parque at 555 St Kilda Road and the recently-approved 250-metre- tall twin tower development at 308 Exhibition Street, which will include over 300 luxury apartments, office space and a five-star Shangri-La Hotel.