“There is a shortage of quality office accommodation in Hawthorn, and this project will offer a better quality, brand-new product,” he said.
The acquisition follows a wave of institutional capital into the Melbourne suburban office market.
Among the latest deals, the founders of carsales.com sold a fully leased building in Mount Waverley in Melbourne’s south-east for just over $60 million to a Singapore-listed trust managed by real estate giant Frasers while the Grollo family sold a Dandenong office building to ASX-listed Growthpoint Properties for $165 million.
Vantage’s portfolio includes office buildings in the Melbourne CBD and on St Kilda Road. It also owns the St Collins Lane mall on Collins Street, which the fund manager acquired in a joint venture with Credit Suisse Asset Management for around $125 million in October 2020 as a turnaround opportunity.
Its acquisition of the Hawthorn office was revealed by Pace managing director Shane Wilkinson, as the developer kicked off a busy construction program.
“We have seven projects kicking off this year,” Mr Wilkinson told the Financial Review.
These include a 4500 square metre Cremorne office development, where Pace will base its head office and apartment projects in Flemington, Coburg and Blackburn.
Alongside these projects, Pace will soon submit plans to the Frankston City Council for a $150 million apartment project on the old cinema site in Frankston, which it acquired for $16 million in February.
As part of plans to recycle into the business, Pace is having a second go at selling a site on Racecourse Road in North Melbourne that comes with a permit and is suited to build-to-rent.
Having purchased the 1.32ha site for $28 million in 2015, Pace is now seeking $45 million via an expression of interest campaign being handled by Stonebridge’s Julian White and Chao Zhang and CBRE’s David Minty, Nathan Mufale and JJ Heng. Advise Transact is the transaction manager.
“There is momentum in the BTR sector, and we don’t have BTR expertise, so there is a good alignment of timing in selling this site,” Mr Wilkinson said.