Vantage Sell 420 St Kilda Rd for $92M
Local property group Vantage Property and US giant KKR have agreed to sell 420 St Kilda Rd for $92M to an offshore buyer at a passing yield of circa 4.8%.
The 10,452sqm property has large floor plates of 2,286sqm and sits on a corner site with three street frontages. The vendors acquired the asset from Chip Eng Seng in 2017 on a 5.6% yield with a 9% vacancy for $68m and commenced work to renovate parts of the asset including a new foyer and cafe operator, lift upgrades, new lift lobbies and amenities and new end of trip facilities.
Vantage & KKR leased up the remaining space and after 2 years elected to offer it back to the market with just a 2.3yr WALE.
According to CBRE, St Kilda Road office rents have grown nearly 50 per cent over the past seven years and a staggering 27 per cent in the past 12 months (to Dec) reflecting both the historically tight CBD market and the recent withdrawal of St Kilda Rd stock, according to CBRE research.
Other recent St Kilda Rd transactions include Marprop's purchase of 541 St Kilda Rd for $65m ($7,872/sqm) in December 2018, Abacus purchase of 464 St Kilda Rd for $95M ($6,871/sqm) in April 2018 and 10 Queens Rd for $60M ($6,897/sqm).
CBRE and Cushman & Wakefield managed the sale process.