Colliers transacts a record-land rate large-scale infill redevelopment site in Melbourne’s South East5 February 2024
Colliers National Directors James Stott and Gordon Code have secured the sale of the last remaining significant land holding in Braeside, to Spectre Property and Hexa Group on behalf of a syndicate represented by Alpha 14 Property Group. Colliers had been quoting $800/sqm during the campaign with good interest at that number.
The South East is the most land-constrained market in metro Melbourne with (approx.) 2.24 years (227 ha) of supply remaining, Governor Road being the last free landholding in Braeside. This prime industrial asset offers flexibility and great potential to buyers, with 2.973ha of industrial 1-zoned land underpinned by a main road location on dual street frontages (Governor Road & Canterbury Road).
Despite the current economic climate, Colliers ran a comprehensive campaign with strict settlement guidelines that focused on top-end pricing buyer profiles. The sale price created a new benchmark for land rates in Braeside, surpassing the initial contract price from 2022.
James Stott, National Director of Colliers, said, “A notable shift in the market has seen owner-occupiers, buyers and private developers outpricing institutional buyers for opportunities of this scale over the past year who have been the take-out buyers for these sorts of parcels over the last 2 years. “
“Whilst we experienced significant interest during the campaign with over 8 bids at the close of the campaign, we had to move quickly to secure an unconditional contract for our vendor, amidst shifting buyer expectations.”
“Whilst the outlook for developers and landlords is favourable into 2024 with positive supply/demand dynamics we expect to see similar levels of unpredictability with pricing for major infill sites offered to the market with buyer credibility & track record, capacity to perform and/or unconditional/clean offers becoming critically important components of managing the sale of major development opportunities in 2024” Mr. Stott added.
Spectre Property and Hexa’s Jason Grasso & Leon Liu said, “Braeside will mark an exciting new chapter for Found where we will continue to exemplify our group’s design-led principles and create another collection of state-of-the-art industrial business spaces.”
“This strategic move reflects our commitment to innovation and underscores our dedication to creating spaces that transcend expectations.”