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Mirvac pays $122m for Melbourne Mint tower

The Age logo The Age 3/09/2018 Carolyn Cummins
Mirvac has bought the Australian Federal Police headquarter [Royal Mint Centre]383 La Trobe st Melbourne. © Andrew De La Rue ADL Mirvac has bought the Australian Federal Police headquarter [Royal Mint Centre]383 La Trobe st Melbourne.

Mirvac has paid $122 million for the Mint complex in Melbourne's La Trobe street with plans for a new top-end office skyscraper.

The seven-storey, B-grade listed tower at 383 La Trobe sits beside the historic Melbourne Mint site and is leased to the Australian Federal Police.

The AFP is relocating from the building which changed hands on a yield of 5.7 per cent from Sterling Global, which is partly-owned by Chinese-born Qi Qi Li. It has been a controversial asset with the Victorian government in November 2016, giving Sterling Global approval for a 70-storey hotel and apartment complex, next door to Republic apartment tower.

Under the current development approval, the proposed hotel would have as many as 200 hotel rooms and 500 units, which raised the ire of tenants in the Republic tower next door.

But that plan has been abandoned with Mirvac confirming it will instead apply for permission to build a 40,000 square metre office tower.

The office site is located within Melbourne CBD’s legal precinct and close to Flagstaff train station and other public transport services.

Mirvac’s head of office & industrial Campbell Hanan said the purchase of 383 La Trobe Streetpresented Mirvac with an opportunity to secure a significant development asset in a well-located part of Melbourne’s CBD, while providing the group with secure income over the medium term.

''We continue to see strong market fundamentals in Melbourne, as well as limited future supply options for tenants beyond the current development cycle,'' Mr Hanan said.

''This acquisition allows us to grow our presence in this key gateway city, while adding to our current $3.1 billion commercial development pipeline."

According to the latest Property Council of Australia data, the Melbourne office vacancy rate sits at a decade low of 3.6 per cent, but there is new supply coming over the next few years.

Brookfield and ISPT have also shown confidence in the sector with the recent launch of an $800 million tower in the heart of the city.

National Australia Bank is the sole tenant so far for the 66,000 sq m tower at 405 Bourke Street, where construction is under way. NAB has an option to take up all the property, which, reports say, will be decided on next month.


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