Savills News

Prime office building in affluent Hawthorn sells for $8,350,000 amid heated buyer contest

A local family has snapped up a high profile 1,039sq m commercial site in affluent Hawthorn for $8,350,000, following a race to secure a rare and exceptional investment opportunity within one of Melbourne’s most coveted inner suburbs

5-7 Guest Street is currently occupied by major Australian market research firm DMB Consultants Pty Ltd, under a 5-and-a-half year lease with an additional 5-year option to renew. The lease provides a net rental income of $362,000 per annum, including 3.5% fixed annual rent reviews with outgoings.

GormanKelly agents Sam Torrance and Nick Breheny negotiated the deal in conjunction with Clinton Baxter and Dorothy He of Savills Melbourne, following a private placement sale process that received strong interest from local and Asian investors, resulting in a tight yield of 4.33% and a building rate of $8,800 per square metre.

Mr Baxter said multiple buyers were drawn to the property’s blue chip location, strong tenancy, in addition to the building’s exceptional presentation.

5-7 Guest Street comprises a freestanding, recently refurbished two-level office building with new glass partitioned boardrooms and meeting rooms, modern open plan co-working areas, kitchen and bathrooms, as well as 19 secure car parking bays.

“The property is zoned for Commercial 1, with a demolition provision available from March 2024, allowing for multiple redevelopment options in future,” said Mr Torrance.

“We generated a huge amount of interest from Chinese buyers all keen to secure an asset in Hawthorn, but ultimately they were out-maneuvered by a strong local family with other nearby assets seeking to expand their portfolio.”

“The opportunity to secure a premium office building in this location is extremely rare,” said Mr Baxter. “We anticipated a great deal of interest, and are proud to have secured such a strong result for the client.”

Learn more about Savills CBD & Metropolitan Sales.

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