A syndicate has snapped up aged care provider Benetas’ head office in East Hawthorn, paying $24.65 million on a 5.5 per cent yield. The deal, struck at a value above expectations, shows the strength of Melbourne’s suburban office market where yields have already compressed 75 points in the past year. The two-storey 4000 square metre building at 785-789 Toorak Road is 94 per cent leased to seven tenants with a slender two-year average lease term. Colliers International agent Peter Bremner, who negotiated the deal with JLL agents Josh Tebb and Marcus Quinn, said the suburban office market is “very very strong”. “We can’t get enough stock. Anything we get sells,” Mr Bremner said. The buyer, a local syndicate, has plans to reposition the slightly underlet building which is close to the Monash Freeway and Tooronga Shopping Centre. Rents have been rising in the inner eastern market and incentives falling as tenants are priced out of the fringe office precincts. Contracts were exchanged within a week of the expressions of interest campaign closing, he said. Eight strong offers were made for the building, mostly by local buyers, Mr Tebb said.
