University of Melbourne pays record price for Red Cross buildings
The University of Melbourne has strengthened its control of future development around its Parkville campus after buying two nearby office buildings on a corner site from the Red Cross for about $46 million.
Australia’s top-ranked university exchanged contracts to buy the charity’s former head office at 165 Bouverie Street and 155 Pelham Street in neighbouring Carlton.
The 2039 square metre corner site is opposite Lincoln Square and is surrounded by student accommodation buildings and new projects, including Little Hall, supported by Financial Review Rich Lister Paul Little and his wife, Jane Hansen.
The deal set a record rate per square metre for a development site in Carlton, exceeding the almost $20,000 per square metre ($31.5 million in total) student accommodation provider Scape paid last June for a nearby 1600sq m site at 558 Swanston Street.
Bruce Tobin, acting associate director of public affairs at the University of Melbourne, confirmed the university was purchasing the two buildings, but declined to provide details about its plans for the site.
Both office buildings, 163-167 Bouverie Street (a three-level building) and 147-155 Pelham Street (a two-level building) are occupied by Super Benefits Administration and RMIT University respectively on short-term leasing deals until May 2022. These bring in net rent of just over $800,000 per year.
The site’s Capital City 5 zoning allows for a number of potential development types, including commercial, student accommodation, residential and education.
Australian Red Cross acting CEO Noel Clement said: “The sale of our Carlton properties forms part of our broader organisational strategy, allowing us to reinvest for the long term in our work, supporting people experiencing vulnerability in Australia and overseas.”
The sale of the Red Cross buildings was handled by CBRE’s Josh Rutman, Mark Wizel, Julian White and Lewis Tong in conjunction with Colliers International’s Guy Wells, Oliver Hay and Trent Hobart.
Matthew Berg from Partner acted as transaction manager on behalf of Australian Red Cross. All declined to comment.
The buy comes after investment manager AMP Capital struck a $150 million deal to take over the student accommodation concession for Melbourne Connect, a new campus and innovation hub for the University of Melbourne in Carlton.
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