Buyer has no draft plan yet for Carlton and United Brewery site

Buyer has no draft plan yet for Carlton and United Brewery site
Buyer has no draft plan yet for Carlton and United Brewery site

The fate of Foster’s century-old Carlton and United Brewery building remains up in the air following the brewery’s acquisition by SABMiller for just under $11.5 billion.

The red-brick brewery complex covers more than 10 hectares of prime inner-city land on the banks of the Yarra River in Abbottsford and is just three kilometres from the Melbourne CBD.

The land is estimated to have a value of about $100 million.

Abbotsford is currently home to luxury residential developments projects including Hamton’s Haven on the River project scheduled to commence construction in late 2011 and Salta Property’s Green Square project – both on Victoria Street. The Trenerry development, on the banks of the Yarra, is slated to be complete in mid-2013.

A report carried out by investment bank Merrill Lynch in June last year found that Fosters could save between $150 million and $200 million a year on 55 million cases of beer produced at Abbotsford by relocating to a new brewery.

The savings would come from reduced electricity, water, labour, packaging and freight costs on each case of beer produced at the century-old brewery.

The CUB building has been home to Carlton & United Breweries since 1904, when the beer-maker relocated from Swanston Street. The building is not heritage listed.

Graham Mackay, chief executive of SABMiller, says a decision on the building has not yet been made.

“To be quite blunt, if you're going to knock down Abbotsford brewery then you've got to build a new one,” he says.

Fosters has already sold off some parts of the brewery complex.

In 2007, Fosters completed a sale and leaseback agreement of 10 properties adjacent to the Abbotsford brewery site for $41 million to a joint venture comprising DPF, a managed fund of Charter Hall and the Perth-based Wyllie Group.

The sale included buildings used predominantly for offices, visitors and display centre together with open car parks used to accommodate staff working at the brewery.

The initial lease agreement was for 10 years with subsequent five- and seven-year options.

Charter Hall sold its 50% stake to the Wylie Group in 2009 for $18.3 million.

CUB’s former Swanston Street location in Carlton is currently the site of Grocon’s $6 million “Pixel” building, Australia’s first carbon-neutral office block.

Larry Schlesinger

Larry Schlesinger

Larry Schlesinger was a property writer at Property Observer

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