$2.65 million for CBD Melbourne fringe site

An Australian developer has outbid international interests to secure a Melbourne CBD fringe site for $2.65 million.

The property, located at 129-131 Market Street South Melbourne, is a 493 square metre site with multiple street access points. It was sold three weeks prior to auction and last sold two years ago for $1,725,000 - a 54% capital growth increase in two years.

Brokers Savills Australia, working in conjunction with M.G. O'Hallaran Property, said the lot was sold subject to a lease at $68,640 per annum.

Savills' Jessee Radisich said the purchaser will use the current zoning to build a premises to suit his business

"But they were also well aware of the prospect of a potential future residential rezoning and while that is only a future consideration, it certainly was an aspect that drove the price up and allowed us to achieve that premium,’’ Mr Radisich said.