An adjoining owner has snapped up a significant office property in Forest Hill for $45.85million as demand for commercial assets in metropolitan Melbourne continues. 

 

Colliers International’s Rob Joyes, Peter Bremner and Rachael Clohesy have negotiated the sale of 347-351 Burwood Highway in Forest Hill on behalf of a long-term Sydney based private investor. 

 

The 2.62ha Commercial 1-zoned site, which is home to two office buildings with a combined net lettable area of approximately 10,692 sqm, changed hands on a passing yield of circa 4%.

---

At a glance: 

• Colliers International's Rob Joyes, Peter Bremner and Rachael Clohesy have negotiated the sale of 347-351 Burwood Highway in Forest Hill on behalf of a long-term Sydney based private investor. 
• The 2.62ha Commercial 1-zoned site changed hands on a passing yield of circa 4%.
• The property was approximately 70% occupied at the time of sale with a weighted average lease expiry of approximately 3.4 years

---

The property was purchased from an offshore investor. 

Mr Brenner said the purchase represented the largest metropolitan office investment to transact so far in 2019.

 

The property was approximately 70% occupied at the time of sale with a weighted average lease expiry of approximately 3.4 years

 

Mr Joyes said office investors were taking a long-term view of the Outer East market with a particular interest in land with existing Zoning flexibility

 

“Over the past two years, over $180 million of office investments have transacted within the Tally Ho Business Park precinct,” Mr Joyes said.

 

“Office investors are anticipating land values will increase significantly in the years to come off the back of State Government investment such as the Suburban Rail Loop and Vicinity’s transformation of The Glen shopping precinct," he said.

 

“Due to the tightening of vacancy in the City Fringe and Inner East markets, tenants view the Outer East as a more affordable option."

 

Colliers International’s latest Metro Office Research & Forecast Report states that vacancy is currently at 8.74% in the Outer East, which is below the long-term average of 9.56%.