Jeff Xu offloads rare Melbourne laneway building for $14.5m
The family behind the Sleepeezee bedding brand has launched into central Melbourne property investment, bidding $14.5 million for a vacant, four-storey laneway building offloaded by prominent developer Jeff Xu.
The former CBD nightclub at 14-18 McKillop Street was snapped up in front of a 200-strong auction crowd on Friday by the Mantzis family who own a mattress manufacturing business that employs about 150 people nationwide.
The family fought off four other bidders in a lively auction to gain control of the property just after it reached its reserve price.
The building, gutted and bare inside, had a colourful tenant history having at various stages been used as a nightclub, squash court and fetish store.
Kon Mantzis said the family would restore the building. “I consider the building to be a blank canvas full of character and future potential,” he said.
Concept images for the redevelopment project, which were abandoned by Golden Age. Image: Supplied
CBRE’s Mark Wizel, Josh Rutman, Nathan Mufale and Dylan Kilner handled the transaction.
Mr Xu’s Golden Age group purchased the laneway property for $10.5 million in 2015.
The developer had plans to restore the building into a boutique office and retail space and launched a leasing campaign earlier this year before abandoning its plans and offering the site for sale.
The property has 1706 square metres of space on a 361-square-metre corner site.
Several unique laneway buildings in the central city have sold this year.
The underbidder for McKillop Street was greenfield developer, race horse owner and hotelier Aziz “Ozzie” Kheir.
Mr Kheir added to his growing portfolio of central-city assets earlier this year, paying $6.25 million for the historic former clubhouse of the Royal Antediluvian Order of Buffaloes at 22 Sutherland Street. He also owns 8 Drewery Lane from which he operates Baroq House.
Golden Age group has other city assets up for sale.
It is offloading five shops at the foot of the 76-level Victoria One tower at 452 Elizabeth Street after refocusing its development operations away from the CBD to the city’s fringe.
Two months ago it emerged as the $30 million buyer of a 21-hectare parcel of land in Rockbank, about 30 kilometres north-west of the city.
The heritage-listed McKillop Street, which will require significant refurbishment, sold for a building rate of approximately $13,000 per square metre, Mr Wizel said.
