Leigh Seymour made headlines last week with the announcement of the sale of a Melbourne car park for $40 million. As reported in The Australian, the Victoria University car park at 300 Flinders Street was purchased by Seymour in November 2011 for $28.2 million. Since that time, property improvements and a change of operator with a 10-year lease presented an attractive return to a private Chinese investor.
The sale of the 574-space above-ground car park achieved a price per bay of $69,700 compared to current average in Melbourne of around $50,000 per bay. The sale was brokered by Savills who reported strong interest from local, interstate and overseas investors before closing the deal with the private Chinese investor.
“Melbourne’s CBD car park market is an exceptionally tightly-held and lucrative market sector, one that is protected by planning policies aimed at minimising the construction of additional car bays within the central CBD,” Clinton Baxter of Savills commented.
The Savills article summarises the attractiveness of the tightly-held asset class: “Facilities can operate on an automated basis, can trade 24/7, have extremely low maintenance and refurbishment costs, and vacancy is virtually non-existent.”