Australia Post has offloaded a 108-year-old retail property in Melbourne’s eastern suburbs for $7.4 million as it looks to shore up its finances via the sale of heritage assets.
The Edwardian-style corner property within the Maling Road Village in Canterbury dates back to 1908. It operated as a post office until 1996, when it was broken up and offered as five separate tenancies.
It sold at auction to a local private investor on a very tight yield of just over 4 per cent, well above pre-auction hopes of around $6 million.
The two-level freestanding corner building with 790 square metres of net lettable area on a 930-square-metre island site is fully leased to the Maling Room cafe, Bendigo Bank, Tim’s Bookshop, Nourish on Maling and Micky Junior Shoes. Four of the tenants have signed new leases in the last 12 months.
The selling agents were Tom Noonan, Tim McIntosh and Ben Baines from Colliers International, who declined to comment.
GPOs for sale
The sale of the Maling Road premises comes after the Australian Financial Review revealed in May that the 207-year-old postal service had embarked on a plan to sell the freeholds of its colonial-era GPOs in Brisbane, Hobart, Perth, Adelaide and the leasehold for the Canberra GPO for around $300 million into a new property trust to be managed by Eureka Funds Management.
Potential bidders include listed fund manager Charter Hall, super fund investor ISPT, private investor Quintessential Equity and South Korean group Samsung.
Under the proposed deal, Australia Post will initially retain a 40 per cent stake in the unlisted Australian GPO Trust with investors taking the remaining 60 per stake. Each co-investor will have first right of refusal to buy each other’s units.
Bids were due by May 20 but it is thought the process was extended until early July.
The portfolio is forecast to deliver $16.5 million in net income in 2017, with an average lease expiry of 32 years. Tenants include the Westin Hotel at the Sydney GPO on Martin Place and retailer H&M in Melbourne’s GPO on Bourke Street Mall.