263 Normanby Road, South Melbourne The first major blue-chip supermarket offering in the Montague precinct of Fishermans Bend - leased to S&P/ASX 20 giant Coles - has sold for $17.5 million, in a big show of faith from investors in the development of Australia’s largest urban renewal precinct.

Fitzroys’ Chris Kombi, Chris James and Ben Liu sold the property at 263 Normanby Road, South Melbourne, located on the ground level of the brand-new prestigious R.Iconic development. The deal is one of the biggest sales of a strata-titled retail property across Australia in 2023.

Coles and Liquorland have just begun trading from the 1,752sqm premises positioned at the base of the 31-level R.Iconic residential tower, which has a dominant 90-metre frontage to Normanby Road and Boundary Street.

The high-profile R.Iconic tower has delivered 456 apartments, while Stage 2 of the project is planned to contain 471 dwellings across 40 levels, located next door at 253 Normanby Road. Normanby Road is set to become a major high-rise thoroughfare, with several 30-plus level developments under construction and planned for the precinct.

“Inner-city Coles investment opportunities are extremely rare, let alone with this unrivalled level of trade growth potential. This campaign and the result were essentially a big show of faith from investors in the future of Fishermans Bend.

“The R.Iconic development is one of the best new buildings in the precinct, which further drove the heated competition between buyers.

“Local, national and international buyers all recognised the never-before-offered chance to invest in a brand-new blue-chip retail asset located in Australia’s largest urban renewal precinct.”

Coles is perfectly positioned opposite the Montague Street Light Rail Station, providing access to thousands of daily commuters and a direct route to the Melbourne CBD and surrounding suburbs. The property is within walking distance to Crown Casino, Southbank Promenade, the Melbourne CBD and Docklands. There is also convenient access to major arterials including Citylink and West Gate Freeway.

“The property is at the epicentre of the Montague precinct’s building boom, with 4,800 dwellings within only 500 metres of the property at various stages of completion, planning and construction,” James said.

“Coles undertook a feasibility study of the area and has made the astute decision to get into a prime location of the Montague precinct, within affluent South Melbourne, in a corner site on the cusp of a building boom. Investors clearly agreed on the strategic location and its trade prospects which will underpin the lease covenant.”

“Coles has found a position at the seat of Australia’s largest urban renewal project. The 480-hectare Fishermans Bend currently has a population of 4,354 , and Melbourne City 1 Council expects this will skyrocket to 80,000 residents and provide employment for 80,000 people by 2050 ,” James said. “We already starting to see the development potential of the Montague precinct come to fruition. We’re also starting to see the flow-on effect to the area’s retail landscape,” James said.

The apartment development pipeline in the immediate area will provide an excellent catchment for Coles in the coming years, and the precinct’s focus as a key residential and employment hub offers unrivalled prospects for ongoing trade growth.” Liu said, “The resilience of essential services and daily needs retail have been demonstrated resoundingly over the past few years, and this deal is the latest evidence of ongoing demand from investors for highly defensive assets deemed to be recession-proof.”

“Income-producing assets purchased now in the current economic environment will prove to be very prudent investments over time.”

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