Sydney’s Eastern and Norwest suburbs have joined Melbourne’s Docklands and inner-city St Kilda as the best performing major capital city markets on Australia’s eastern seaboard over the previous 12 months.
But overall, the eastern seaboard markets’ performance resembles a game of snakes and ladders. While four regions emerged as clear leaders in the year to April 2024, another five capital city markets surveyed by CoreLogic’s Cityscope team are still wrangling with economic headwinds.
WINNERS
1 The affluence of Sydney’s eastern suburbs underpinned the strong showing of this desirable region. In the 12 months to April 2024, the total value of commercial property transactions rose from $844.1 million to $917 million after several strong sales.
Big deal: Without a doubt, the $215 million paid late 2023 for the renowned InterContinental Sydney at 33 Cross Street Double Bay. The 5-star, five-level boutique hotel that has counted David Bowie, Elton John, Madonna and Princess Diana among guests came with a 37-shop retail area along with an opulent dining room, ballroom, four floors of residential units and 140 hotel suites. It was sold jointly by the Sydney offices of CBRE and Colliers.
2 For the uninitiated, Sydney’s Norwest started life as one of the city’s biggest and best business parks before emerging as a suburb in its own right. This hot spot lies in the Hills local government area, 35km north-west of the Sydney CBD. Norwest is now a major employment centre that’s home to well over 400 companies, businesses and multinationals such as IBM and Woolworths. The burgeoning suburb’s appeal was boosted enormously when the new metro line linked the Hills to Epping and Chatswood.
The total value of commercial property sales in the 12 months to April this year rose to $255 million from 127 sales, increasing from $94.8 million from 84 sales recorded at the same time the previous year. Most sales took place in the last quarter of 2023: 69 CRE transactions totalling $154.3 million.
Big deal: The modern 2424sqm freestanding office + warehouse facility with high clearance space and yard at 28 Brookhollow Avenue which sold for $16.1 million via Colliers – Sydney West. The property, on a 7249sqm block, is located walking distance to Norwest Metro station and the area’s central Market Town Shopping Centre and is near the suburb’s major thoroughfare Windsor Road.
3 Now we move to Victoria where the commercial market of Melbourne’s St Kilda Road has been firing on all cylinders. Property sales values not only increased significantly over 12 months, up from $540.6 million to $702.2 million, they have also shot up in the past three months, hitting $274.6 million (from 184 sales) up from $92.8 million (from 150 sales) recorded during Oct-Dec 2023.
Big deal: The six-level 463-space concrete parking station at 2 Bowen Crescent Melbourne for $42.42 million. The property which settled in the last month came with a ground-floor shop sat on a 1821 sqm block, and had the enticement of approval for the development of a 19-storey apartment building.
4 By all indications the contemporary waterfront retail, dining and entertainment hub of Docklands is noticeably on the ascendant: in the three months to April this year alone, commercial property sales value jumped to $91.2 million after topping out at just $6.1 million from 8 sales that took place in the three months to January. The 12-month total for Docklands was $369.2 million from 34 sales – a large increase from the previous year’s $26 million from 39 sales.
Big deal: The 15-storey Four Points Sheraton Hotel at 443-451 Docklands Drive bought for a reported $96 million by listed fund manager MA Financial. It was the first notable hotel deal of this year and acquired as the seed asset for MA Financials’ new accommodation hotel fund.
Playing catch-up… are the markets defined by Sydney Units, North Sydney (despite a significant increase over the last three months from $30 million to $159 million worth of sales), Pyrmont/ Ultimo and, in Victoria, Eastern Melbourne, and in South Australia, the Adelaide CBD. Watch this space!