Sydney developers head to Melbourne for BTR projects
Sydney build-to-rent developer Novus has unveiled plans for its new project, Novus on Bowen, near the soon-to-be finished ANZAC railway station.
The old six-level carpark at 2 Bowen Crescent is the location of the company’s second project in Melbourne, where cheaper land and speedier planning processes trumps Sydney.
Renders of the proposed Novus on Bowen.
Records show Novus settled on the property last week, paying a bumper $42.41 million for the 1864-square-metre site.
Last year five build-to-rent projects were completed in Melbourne last year but none in Sydney. While there are now eight projects underway in Sydney, Melbourne has 35 ready to go and a further 32 projects in either application or early planning.
Architect Rothelowman has redesigned the original apartment tower plan into an 18-storey building with 215 units offering a mix of apartments from studios to four-bedders.
The vendor, Chinese-backed builder Wuzhong, had obtained a permit for a 19-storey project with 214 apartments in 2016 following.
The deal was negotiated last year by Dawkins Occhiuto’s Walter Occhiuto.
There’s been plenty of news lately about BTR developers struggling to get projects financed.
But Novus chief executive Adam Hirst said “You can find debt for projects – although everything is a bit more expensive – but the hard part is equity. Finding and securing the equity is holding projects up.”
While Maxcap supplied the debt, Novus sourced equity for this project from a range of parties, he said.
The company has three projects bogged down in planning in Sydney but only one, bought in 2022, is close to ready.
“As opposed to Bowen Crescent, which settled last week and we can start demolition four weeks later,” he said.
Hirst, who set up and ran Mirvac’s BTR division, is looking forward to operations starting soon on the group’s nearly completed 153 Sturt Street project.
“Build-to-rent appears like a development business in Australia because there’s so little product. But it’s also an operational business,” he said.
Novus is looking for other permit-ready sites in a bid to speed up the development process.
Hotel
Salta is selling a four-level serviced apartment project in its riverside residential precinct in North Richmond.
Built in 2014 as part of Salta’s Green Square project, the 93-key hotel at 611 Victoria Street was originally Quest Apartments. The property is now operated by Corporate Living Accommodation, which has another hotel on Glenferrie Road, Hawthorn.
611 Victoria Street, Abbotsford.
The hotel has a gym, two conference rooms and a 53-bay car park. It returns $2.16 million a year in rent on a lease expiring in 2036.
Gorman Commercial’s Peter Bremner and Jonathon McCormack, with JLL’s Nick MacFie and Peter Harper, are managing the campaign. They’re quoting more than $28 million for the property.
It’s just a few minutes from the Yarra River and the Victoria Gardens shopping centre across the road.
Salta recently completed all the residential development planned for the northern Abbotsford side of Victoria Street. More apartments, including a new BTR project, are in the pipeline for the Victoria Gardens site.
The company is offloading some of its investments to fund its next development cycle. Last month, it sold an office next door to the Real Estate Institute of Victoria for $10 million.
Stonnington
A house on a large 3934 square metre parcel of land in Glen Iris changed hands for around $12 million shortly before Christmas.
Records show Stonnington City Council has put a caveat on the heavily treed property at 9 Scott Avenue, indicating it is the buyer of the house which last changed hands more than 100 years ago.
Ten years ago, Stonnington City Council had a secret list of 450 sites in the well-heeled neighbourhood which it was planning to turn into pocket parks.
The deal was done by Marshall White agents Marcus Chiminello and Jack Nicol, who declined to comment on the buyer. A Stonnington spokesperson said confidentiality agreements were still in place and would not comment.
Abbotsford
Raman Shaqiri, one half of the so-called Corkman Cowboys, is back in the saddle, paying $13 million for a corner site in Abbotsford.
The holding at 288-296 Johnston Street is a stone’s throw from Victoria Park – both the old Collingwood football ground and railway station.
Records show Shaqiri’s SQ Abbotsford settled on the property in January and has already lodged an application to start on a 14-storey project.
288-296 Johnston Street, Abbotsford.
The 1214 sq m Commercial 1-zoned site includes the old Tarantos Shoe outlet, a double-storey Victorian era building on the corner of Lulie Street.
Shakiri told Capital Gain he had bought the site “with plans and permits” and aimed to offer “home seekers” quality housing located close to public transport, schools, parklands and hospitals.
Some locals were outraged after the last attempt to develop the corner property, which involved demolishing the Taranto pile.
In 2016 Shaqiri and partner Stefce Kutlesovski illegally knocked down one of Melbourne’s oldest pubs, the Corkman, and may yet have to rebuild it.
The popular watering hole was across the road from the Melbourne Law School, which trains hundreds of lawyers every year.
There’s a slew of new apartment and commercial projects overshadowing the northern side of Johnston Street amid a mix of historic and mid-century commercial buildings.
Fresh to market is the Ampol petrol station across the street from Tarantos at 276-286 Johnston Street.
276-286 Johnston Street, Abbotsford.
Records show it last changed hands in 2001 for $2.55 million. The 1693 sq m property is expected to sell for around $14 million. There’s just two years left on the lease.
JLL agents Jesse Radisich, Tom Noonan and Jarrod Herscu are handling enquiries.
VLE
The Victorian Livestock Exchange is offloading its Pakenham property amid booming industrial values in the south-east.
The VLE, which represents cattle graziers and others involved in the livestock business, has operated the property since the late 1990s and is poised to expand its operations in the regional town of Leongatha.
The 14,999 sq m warehouse and office is on a large 6.82 hectares of land at 39 Exchange Drive in what is Industrial 1-zoned land inside the Officer-Pakenham industrial precinct.
Colliers agents Daniel Telling and Gordon Code, along with Facey’s Josh Kendall are running expressions of interest in the property. It’s expected to fetch more than $30 million.
Any future development on the site could be worth $100 million. Prices in the region have surged 40 per cent since 2021, with big players such as ESR buying 92 Enterprise Road for $30.11 million and Brookfield Properties paying $89 million at 60 and 130 Greenhills Road.
Last week, Salta sold a 64.4 ha parcel of land in nearby Cranbourne for around $200 million.
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