Marking the largest strata portfolio transaction in the city’s history, a ground floor retail portfolio of eight shops below Melbourne’s Liberty Tower has sold for $21,500,000.

The building was developed by the Schwartz family, including publisher Morry Schwartz and his brother Danny, who held onto the retail component since the tower’s completion in 2002. Tenants include an IGA supermarket, Japanese eatery Purple Peanuts and Gloria Jeans Coffee, which is set to vacate the store mid-way through 2019.

Offered together as part of CBRE’s latest Premium Property Portfolio Auction, Mr Danny Schwartz described the atmosphere at the auction as “electric”. 

“Selling a property like this needed something different so we crafted a very special campaign and went in hard on the direct marketing. The team at CBRE left no stone unturned and targeted key groups to ensure we got results,” said Mr Schwartz. “The auction was pure theatre, the team generated a frenzy and the atmosphere was electric.”

The properties were marketed by CBRE’s Josh Rutman, Nathan Mufale, Kevin Tong, Dylan Kilner and Max Ruttner, with nine bidders participating in the auction, including representation from Malaysia, mainland China, Taiwan and Hong Kong.

CBRE's Mark Wizel. Source: CBRE

CBRE’s Mr Rutman said the Liberty Tower portfolio was not straightforward, which proved challenging for some of the more traditional retail investors. However, the sale to a Sydney-based investor reflects a new pricing benchmark for strata portfolio investments in Melbourne’s CBD.

“There were constraints surrounding the owners’ corporation which needed to be worked through,” Mr Rutman said. “We expected strong interest, but were pleasantly surprised by the sheer depth in the market.”

CBRE’s Mark Wizel added; “The decision to offer the shops via a portfolio auction differed to the conventional wisdom, suggesting either an Expressions of Interest campaign or on-site auction, however the result and depth of bidding on the night is proof that the PPPA platform is resonating with buyers.”

The sale is the latest sign of investor interest in Melbourne CBD’s western precinct, following the sale of 454 Collins Street to a Macau-based investor and the acquisition of 601 Bourke Street to China-based Far East Enterprise.

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