Chinese buyer pays 32% over reserve, a record land rate, for North Melbourne office site

A new record land rate for North Melbourne, of $6,358 per square metre, has been set by a Chinese buyer who paid $13.2 million for an office building on the edge of the CBD. This totaled 32% over reserve, according to Savills Australia selling agents Clinton Baxter and Nick Peden.

The property, 13-21 Bedford Street, was owned by Engineers Australia and is currently leased to six tenants totaling 52%.

It is a 2,219 square metre building on 2,079 square metre site. It is zoned mixed use, which has the potential for development of up to 24 metres or approximately eight levels.

It isn’t clear what the buyer intends to do with the site in the long-term, however redevelopment is a clear option. In the short to medium term, the property will be leased.

“The price of $13.2 million reflects a new land value record for North Melbourne of over $6,000 a square metre and is an indication of the immense competition for high quality properties with strong development fundamentals,” said Baxter.

In total, the campaign attracted 125 enquiries and 29 inspections.

There were then 11 expressions of interest, and Peden notes that the top three buyers were off-shore located.

“We have had enormous enquiry from off-shore buyers for similar properties with development potential and so it was no surprise that there was such strong foreign interest in this property,” he said.