Fortis acquires two Melbourne sites for $108 million commercial projects

Fortis has acquired two new sites in Melbourne’s city-fringe, strengthening its commercial property portfolio.

The projects will go on to offer premium commercial office space in Richmond and South Melbourne. Fortis will continue to hold these commercial buildings as long-term income producing assets. Non-bank lender Pallas Capital is funding the acquisition and development of these projects.

Acquired for circa $16 million in a transaction negotiated by Ben Baines, Ted Dwyer and Daniel Wolman of Colliers, 1 Little Lesney Street in Richmond is situated on a land area of 907 sqm. It is situated next to 8 Brighton Street, where a mixed-use Fortis project valued at $115 million is currently underway. The proposed new build is expected to offer more than 5,500 sqm NLA across 12 levels, with extensive ground floor activation, dual street frontages, expansive floor plates, high quality EOT amenities, and ample bicycle, motorcycle and car parking. The planning application for this site is expected to be submitted in February.

122-132 Moray Street in South Melbourne was acquired for circa $10 million in an off market transaction, and is the fifth commercial project by Fortis in the city-fringe suburb. The 697 sqm site is centrally located, in proximity to the upcoming ANZAC metro station, Coventry Street and Clarendon Street retail districts, and South Melbourne Market. A proposed new build on the site is expected to offer approximately seven storeys with a retail offering on the ground floor, and 2,800 sqm NLA. The planning application for this site is expected to be lodged in Q1 2022.

“Over the last few years, we have witnessed the increased demand for premium city-fringe commercial offices in Melbourne. In an endeavour to harness this opportunity, our latest sites in South Melbourne and Richmond will offer a high-end point of difference to the fringe office market and add to our growing half a billion dollar portfolio of commercial assets in Melbourne. Our national commercial portfolio is currently well in excess of a billion dollars,” says Charles Mellick, Director, Fortis.

Pallas Group is the parent company of structured property investment arranger Pallas Capital and boutique developer Fortis. The expected end value of Fortis’ Melbourne projects currently under construction or under a planning proposal is $1 billion, with a further $1.25 billion pipeline of work in Sydney.