15 South Melbourne terrace shops could net $50m

A mega selldown of 15 terraces along South Melbourne’s iconic Emerald Hill could stand to rake in a total of $50 million. 

The first three properties to be offloaded along the Clarendon St shopping precinct have sold for a total of more than $10 million.

The pricey portfolio was acquired by two Melbourne-based investment companies in 2015 for a staggering $27.5 million.

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PodCo and Terraplex then subdivided the landholding, purchased from Australia’s honorary consul of Monaco Andrew Cannon, into 15 separate titles.

The three properties so far have sold for an average of $3.345 million. If the remaining 12 secure similar multimillion-dollar price tags, the investors stand to almost double what they paid for the properties.

South Melbourne’s investment attributes, including an estimated 46 per cent growth in population by 2022 and a forecasted development of more than 1800 apartments, were big drawcards, according to PodCo director Anthony Wilson.

If the sales continue in a similar fashion, the strip could sell for a total of more than $50 million.

“Direct access to the CBD, encouraging population growth, strong numbers of white collar employment and close proximity to tourist’s attractions make Clarendon St a true 24/7 activity precinct,” Wilson says.

“A development pipeline comprising over 1800 residential apartments and over 90,000sq m of forecast office space makes Clarendon St one of Melbourne’s most progressive locations.”

The latest property to go under the hammer was a double-fronted terrace containing four apartments and two shops.

CBRE’s $3 million price expectations for the property at 350-352 Clarendon St were quickly exceeded, with an opening bid of $3 million at auction late last month.

A crowd of more than 100 turned out to watch 350-352 Clarendon St go under the hammer.

It was called on the market at $3.8 million, with four bidders pushing the price to a whopping $3.91 million.

A local investor secured the keys and plans to hold the property, cashing in on its annual rental income of more than $176,000.

“South Melbourne continues to be a target for local and Asian investors throughout Melbourne,” CBRE’s Rorey James says.

“Proximity to the CBD and the surrounding affluent suburbs including Albert Park, Middle Park and South Melbourne itself are driving strong buyer appetite.”

The first property to kick off the selldown, 338-340 Clarendon St, secured $3.95 million in March and was followed by the sale of number 342 for $2.175 million.

A fourth terrace is expected to hit the market later this year, according to industry sources.