Prominent West Melbourne Development Site Sold

A mixed-use development site on a prominent West Melbourne street corner has sold at auction for $9.4 million.

The opening bid for 137-157 Adderley Street started at $5 million, with five local and offshore groups competing for the premium landholding, before a final sale price of $9.4 million was recorded.

CBRE’s Victorian Development Sites team, led by Ed Wright, Julian White and Tom Tuxworth, managed the auction on behalf of a private investor.

Auburn Property Group successfully secured the 1,597sqm property after outbidding four groups – two local developers and two Asian developers. The sale price reflected a land rate of $5,886 per square metre.

Mr Wright said the property’s strategic corner location was pivotal to the sale.

“The opportunity to acquire a presence in one of West Melbourne’s most well-known and high profile locations attracted widespread interest from a vast pool of buyers, including both offshore and local groups,” Mr Wright explained.

“Located just 500m from the Melbourne CBD and in close proximity to the DFO Spencer Street Shopping Centre, the property is ideally positioned to capitalise on the surrounding amenity and strong existing patronage in the area.”

Mr White said the sale marked the ninth major development site deal in West Melbourne over the past 12 months.

“Smart developers are recognising that for $5,000-$6,000 per square metre they can acquire a prominent landholding, less than 500 metres to the CBD. This is particularly appealing when compared to other city fringe markets such as Richmond, Southbank and East Melbourne, where land rates are typically in excess of $15,000 per square metre.”

Mr White said recent planning approvals in the area may have also acted as a catalyst.

“Good quality planning outcomes are becoming a regular occurrence in the area, with council having clearly identified the location as ideally suited to apartment development,” Mr White added.