Palmerston

Project Location

The subject property is located within the premium city fringe suburb of South Melbourne, approximately 3 km south of the Melbourne Central Business District (CBD). Surrounding developments to the south are predominantly medium rise apartments and office developments constructed over the last 30 years, while to the north the area is characterised by single level period dwellings which protect the views towards the Melbourne CBD. The site is surrounded by an eclectic mix of restaurants, cafes, and shopping. The subject property is also well serviced by public transport (buses, train, tram) and is within walking distance to recreational and educational amenities.

Project Development

The subject property is an eight storey A-grade commercial office and retail building that is almost completely constructed with minor works and fit-out remaining. 66.4% of the total net leasable area has been successfully pre-leased and there has been plenty of pre-development interest from prospective tenants for the existing vacant office accommodation. Occupier demand is expected to improve over the coming year as employment within the Australian white collar industries is forecast to grow over the medium term. Furthermore, upon complete construction, the subject property would be a new boutique office building built to an A grade standard and will be one of the premier commercial buildings in its area, with an anticipated NABERS** rating of 4-5 stars.

Project Loan Details

The purpose of this loan is to fund remaining construction works and the Borrower intends to repay the loan by leasing the balance of the completed development and offering the building for sale in Q1 2023.