Chinese-backed developer Longriver has leapt out of the blocks in 2019, snapping up a major corner site in the Melbourne CBD for almost $26 million from prominent criminal lawyer Alex Lewenberg and his family.
Known as the “Queens Collection”, the 760-square-metre site on the corner of Queen and Little Lonsdale streets, at the gateway to Melbourne’s legal precinct, houses two mixed-use commercial buildings, the six-level EOS Centre at 288 Queen Street and the four-level China Square building at 328 Little Lonsdale Street.
The deal was struck on a yield of 2.3 per cent and at a land rate of almost $35,000 per square metre, a record for this part of the Melbourne CBD, according to selling agents CBRE.
Damien Hehir, development director at Longriver, said the two buildings represented an “important and strategic CBD corner site” at the northern end of the city.
“The site affords the opportunity for a mixed-use development to add to Longriver’s $1 billion-plus project pipeline,” Mr Hehir said.
“We are optimistic about Melbourne’s CBD property market and believe that there is a strong market for mixed-use developments with a multi-level retail and food and beverage offering,” Mr Hehir said.
The site is close to a number of major projects including a proposed Mirvac office tower at 383 LaTrobe Street and high-rise apartments at 380 Lonsdale Street by Brady Group.
The sale of the two buildings delivered a bumper capital return to Mr Lewenberg and his family, with property records showing 288 Queen Street changed hands for $770,000 in 1995 and 328 Little Lonsdale Street for $1.8 million in 2002.
“It was time for us to move on and we couldn’t be more pleased with the result achieved. We wish the new owners well,” Mr Lewenberg said.
The sale of the two buildings was negotiated by Josh Rutman, Mark Wizel, Lewis Tong and Alex Brierley of CBRE.
Mr Wizel said several long-term CBD owners were reviewing their portfolios, “especially those that are dealing with challenges such as land-tax hikes and generational changes within their own families”.
“Prices still remain at all-time highs and this has presented a significant opportunity for those that are considering the disposal of their holdings in the first quarter of 2019,” he said.
“This transaction highlights that buyers are taking a longer-term view on the Melbourne CBD market, and whilst there are some clear challenges at present for high-density development, the fundamentals remain strong,” Mr Rutman said.
Longriver, founded by Yunhe “Andrew” Yu, has a large portfolio of projects on its books including high-rise apartment projects in Box Hill and the CBD.
In mid-2017 it splashed out $23 million to buy a BP petrol station in the high-rise suburb of Box Hill offloaded by Greek-Australian petrol magnate Andreas Andrianopoulos.
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