Drug kingpin’s former Sydney Road arcade for sale

Sydney Road, a diversified shopping strip that easily claims to be one of Melbourne’s multicultural epicentres, is pumping as it and surrounding suburbs undergo rapid gentrification and become a magnet for hipsters.

Mokbel bought the market in 1999 for $1.7 million with plans to redevelop the rundown arcade.

Aesop founder Dennis Paphitis snared the 3120 square metre site at 655 Sydney Road for $17 million in 2020 in a joint venture – evocatively named The Burnt Ones – with Canberra property developer, the Molonglo Group.

They listed the site for sale in 2022 before they had even settled the transaction but, apparently, did not like any of the offers on the table. The price is unlikely to have shifted much.

JLL’s Jesse Radisich, Josh Rutman, MingXuan Li and Mark Stafford, with Colliers’ Philip Heberling and Jozef Dickinson are handling enquiries.

KFC on Chapel

Owners on the other side of the city also think now is a good time to sell retail property.

The long-standing KFC on Chapel Street is up for sale after more than 50 years in the hands of the one family.

The grand Victorian building has been a KFC for much of that time. It sits on the corner of Elizabeth Street, near the entrance to Prahran Market.

Records show it was bought by Maja Investments in 1974 for $62,500. The 470 square metre building is on a 261 square metre piece of land at 379 Chapel Street and returns $279,000 a year in rent.

An older building, it is not expected to fetch the super-sharp yields achieved by other recent fast food outlets transactions. A yield of above 4 per cent puts the likely price at more than $5 million.

It goes to auction on June 7 through Stonebridge’s Nic Hage and Rorey James with Wilson’s Adam Guest.

Development duo

North of the Yarra, National Basketball League owner Larry Kestelman has re-listed the Moonlight Receptions Centre at 622 Nicholson Street where he once had grand plans for a $140 million, eight-level office building.

The bedraggled North Fitzroy pile – once the scene of happy celebrations – is a sad sight. The 1834 square metre site has mixed-use zoning and last went on the market in 2020 but didn’t sell amid the year’s coronavirus dramas.

Records show Kestelman paid $15.1 million for the site in 2018 at the peak of the last development cycle, but it could fetch around $18 million in today’s market.

Colliers agents Jozef Dickinson, Ted Dwyer, Philip Heberling and Georgie Long have the listing.

Dickinson said vendors of the current crop of sites had bought when build-to-sell developers were the only other competitors but build-to-rent developer-operators had improved the sales options.

“There’s a deeper pool for sites now,” he said.

Kestelman, who developed the massive $700 million Capitol Grand apartment complex on the corner of Chapel Street and Toorak Road, mostly makes headlines with basketball related matters. He made his money selling the Dodo internet service provider in 2013 for $204 million.

Sydney developer

Also up for grabs, is a 2023 square metre development site at 256-262 Normanby Road, near the Montague Street light rail stop, which comes with a permit for a 228-unit high-rise tower or 25,000 square metres of space.

Records show it last sold in 2022 to Sydney developer Ami Weinstock who paid a total $10.52 million after the previous owner, Ausun, was wound up.

It is in a burgeoning build-to-rent precinct and unlike many of the other abandoned development sites in Melbourne, left half-demolished or in disarray, the warehouses on this site are still in use and making good money. It returns $476,602 a year in rent.

Cushman & Wakefield agents Daniel Wolman, Hamish Burgess, Marcus Neill and Oliver Hay are handling enquiries. It’s expected to fetch in the mid-teens – that is in millions of dollars.

Gandel’s scion

In Armadale, Helen and Tony Gandel – son of billionaire shopping centre owner John Gandel – have listed their development site at 935-951 High Street.

Plans for an office project above the Edwardian-era shops was knocked back last year and it only recently received approval for a 26-apartment project.

Records show the couple paid a total $11.15 million for the 1355 square metre site in 2019. It’s across the road from Armadale railway station in the heart of one of the strongest shopping strips in Melbourne.

Recent deals in the neighbourhood put the value at $12,000-$15,000 a square metre which pans out somewhere between $16-$20 million.

JLL’s Radisich, Rutman and Li are handling the campaign but declined to comment.

Wendouree Woolies

United Petroleum co-owner Eddie Hirsch is offloading a Woolworths supermarket in the Ballarat suburb of Wendouree.

Records indicate a company owned by Hirsch and UP partner Avi Silver bought the supermarket directly from Woolworths in 1991 for $1.375 million. It is now owned by Hirsch and Gabriel Amira and is expected to sell in the sub-$15 million range.

The freestanding supermarket is on a 6394 square metre site at 1203-1205 Howitt Street between a busy road and the railway line.

Woolworths has 20-year lease that expires in 2030 with three more ten-year options and pays around $733,000 a year in rent.

JLL agents Jarrod Herscu, Stuart Taylor, Tom Noonan and Li are handling the sales campaign.

A cheaper supermarket investment is available at 231 St Georges Road, Northcote, at the foot of an apartment building completed about five years ago by Athena Panias’ Nack Developments.

It returns around $190,000 a year and should fetch around $3.5 million. CBRE agents Scott Hawthorne, Nathan Mufale and JJ Heng are handling enquiries.

Warehouse lease

Property giant Salta has leased one of two spec-built warehouses recently completed by CIP Construction at its huge 180 hectare Nexus Industrial Estate in Dandenong South.

Beaumont Tiles, owned by Bunnings since 2021, has committed to a 10-year lease on a 14,000 square metre warehouse and a 590 square metre office. Rents in the area for super prime warehouses are currently running at between $155-165 a square metre.

Nexus already houses a slew of logistics and distribution centres for Woolworths, Bunnings, Visa Global and Silk Contract.

The lease was brokered by CBRE’s David Aiello, who is handling enquiries for the second warehouse, along with Colliers Gordon Code.