Office development opportunity in Melbourne’s Silicon Valley

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A LAND parcel with commercial development potential in Melbourne’s Silicon Valley Cremorne is set attract strong interest when it goes under the hammer as developers flock to the city fringe suburb in response to more companies adopting ‘work near home’ workplaces.

Teska Carson is marketing the land parcel at 48 Cubitt St. It is currently improved by a single level, Victorian residential building on a Commercial 2 zoned 338 sqm site with 12 metres street frontage, a separate lock up garage/warehouse at the rear, and on-site parking for three cars. It is being sold subject to a 12-month lease returning $26,000 per annum.

Agents Matthew Feld and Adrian Boutsakis said the property provides an outstanding development opportunity within Melbourne’s most sought-after inner-city location.

The agents said the Commercial 2 zoning is ideally suited for a multi-level commercial development (STCA), appropriate manufacturing and industries, bulky goods retailing, other retail uses, and associated business and commercial services.

The offering comes as developers such as Riverlee, Salta Properties and Abacus, increase their suburban offices offering to meet the growing demand from companies and workers for ‘work near home’ spaces. And after a period of uncertainty across the office market, Australia Post became one of the first multibillion corporations to move out of Melbourne’s CBD post-COVID, in favour of the inner suburb of Richmond after agreeing to anchor a new $130 million Charter Hall office complex.

Commercial real estate financier Monark Property Partners, a joint venture between Michael Kark and Adam Slade-Jacobson and the Bori Liberman family office, Jagen Pty Ltd, is funding a spate of new boutique commercial developments in Collingwood, Cremorne and Prahran.

Acknowledging this new structural shift in the commercial property development and investment market, Monark recently entered into a joint venture with developer Curtis York to develop a boutique office project at 390 Malvern Rd Prahran.

Monark is also financing two boutique offices in Cremorne. The first is a 1400 sqm seven-level building and the second is 14 semiattached three-level offices comprising of circa 2500 sqm and 30 car parks.

Monark co-founder Adam Slade-Jacobson said suburban office developments such as these projects provide an exemplar of the post-covid office model, and being located in areas that do not require staff to commute on crowded public transport to the CBD.

Slade-Jacobson said there is increasing demand for high quality inner urban office space that are close to community amenities such as shopping, transport, parking, restaurants and cafes. With millennials currently accounting for 38% of the workforce there has been a significant shift in workplace dynamics to more flexibility and choice.

Work near home is also helping to reactivate retail shopping strips.

“We very much subscribe to the theory that well designed, boutique commercial office buildings located in inner city fringe locations will be strong performers in a post-Covid economy.

“There is a genuine desire to work close to home in office buildings that are adaptable, energy efficient, offer outdoor access, fresh air and enable businesses to control their own environment.” Slade-Jacobson said.

Meanwhile Teska Carson agents are expecting strong interest from investors and developers for the 48 Cubitt St site.

“Cremorne has demonstrably been the most sought-after city fringe area in Melbourne in recent years with all properties to hit the market attracting a very strong reaction from investors and developers,” Feld said.

“The result is that opportunities such as this, so close to the CBD and the amenity it offers, are becoming very hard to find especially with the increasing gentrification and residential conversion of many inner-city suburbs,” Feld said. “Its location has driven a high level of demand resulting in substantial growth in recent years with the construction of numerous high profile residential and commercial developments. An influx of major IT and creative tenants has led to Cremorne being dubbed Victoria’s Silicon Valley.”

The property will be auctioned on Wednesday, June 16, at 1pm on site.

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