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Market Insights

28.11.2019

Retail strip for sale on Victoria’s Mornington Peninsula

 An iconic Mornington retail complex is to be offered for sale, introducing to the market a multi-unit retail centre with significant land holding and future development potential on the Mornington Peninsula – Victoria’s most visited tourism region. 

Located at 53-55 Barkly Street, the complex commonly known as Barkly Square comprises nine retail units situated on an island landholding of 2,029sqm. 

CBRE Melbourne’s Rorey James, Nic Hage, JJ Heng and Julian White have been appointed to sell the property on behalf of receivers Cor Cordis. 

Mr James said the property is likely to attract interest from a range of buyer types. 

“The nine retail units will provide strong income for investors, while there is also plenty of flexibility for groups looking to add value given the large land holding and four street frontages,” Mr James commented. 

“Aside from the two major shopping centres, Barkly Square is the only retail island site in Mornington. Opportunities like this rarely come to market and it may be a long time before something similar is offered.” 

“Income producing properties with upside have been the most sought-after product on the Peninsula for the past four years,” Mr James continued. 

“Buyers, particularly those familiar with the area, recognise the growing demand for residential accommodation and are typically willing to pay a premium if a property has redevelopment potential.” 

Earlier this year CBRE transacted 69 Main Street, Mornington for $2.7 million to a domestic investor/developer who has intentions to redevelop the property in the next five to ten years. 

This follows CBRE’s $39.4 million sale of Mornington Village Shopping Centre in 2018 to a Chinese investor with plans to significantly extend the property’s retail space and the 2016 sale of 9-13a Main Street to a Melbourne solicitor for $5.4 million with residential accommodation construction currently underway at the rear of the property. 

Mornington is located along the coastline of Port Phillip Bay on the Mornington Peninsula, a popular destination that attracted over 7.5 million tourists in the year ending September 

2018, injecting over $1.1 billion into the local economy and making it Victoria’s most visited tourism region. 

Mr Hage noted although Mornington is a popular weekend getaway destination, it is not impacted by the seasonality of other areas of the Peninsula due to the large presence of medical, education and industrial services, which position Mornington as a central hub for the wider Peninsula and support year-round trade. 

“Mornington’s Main Street has some of the lowest retail vacancy in Victoria, often below two per cent,” Mr Hage said. 

“The convenience of over 2,500 council car parking spaces and the attraction of two major supermarket sites at Mornington Village and Mornington Central supports local businesses, as does the popular Main Street market which has been running weekly for over 30 years.” 

Mr James added; “CBRE has handled 22 of the 28 investment transactions that have taken place on the Mornington Peninsula since 2016. We have seen first-hand the increase in buyer interest, particularly on strips like Main Street, Mornington, Ocean Beach Road, Sorrento and Point Nepean Road, Rosebud.” 

The sale of Barkly Square follows the recent transactions of three nearby properties; the Sportsgirl building in Sorrento transacted to a Melbourne based investor/developer for $4.7 million (in excess of $1 million over the vendor’s reserve), the ANZ building on Mornington’s Main Street sold to a Sydney-based Chinese investor for $4.5 million (reflecting a return of 3.4%) and the previously mentioned 2018 sale of Mornington Village Shopping Centre to a first time Chinese investor for $39.5 million. 

CBRE Insolvency Services Director Julian White will work in partnership with the CBRE Melbourne & Mornington Strip Retail Investments team to oversee the relevant probity and risk management processes. 

53-55 Barkly Street will be sold by onsite public auction on December 18th at 12:30pm. 

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