THE PROPERTY DEVELOPMENT REVIEW
Which market sectors do you expect to be in high demand over the next 12 months? Strata office is currently one of the most active sectors of the market, largely driven by owner occupiers looking to acquire their own office. These owner occupiers are looking to improve their office accommodation and staff amenity while creating a long term self-managed super fund investment. Savills are currently marketing five (5) high-quality strata office developments in Richmond, Ivanhoe, Brunswick & Box Hill. Across the board, 90% of the enquiries for the offices are from owner occupiers who are currently located within a 3km radius of these developments. These groups are looking for office suites in the range of 70sqm to 650sqm (full floor). These buyers generally live close to the area and are looking to improve their work/ life balance with less travel time to the office each day. With entry purchase prices often under $500k, the offices become an affordable purchase that is generally done through their self-managed super fund and allows buyers to own their office rather than rent. As an expert in the field, what guidance would you give to a Developer with a $10 million budget on how to identify potential development opportunities based on site selection and location? Identify a commercial development site that has strong links to public transport and road networks along with great surrounding amenity for tenants/occupiers. Savills research has identified that well located office developments with these attributes are in strong demand from the market. Outer metro areas of Melbourne like Bundoora, Ringwood & Caroline Springs, along with Geelong, that have seen significant population growth and have an under supply of office space, are key areas for consideration.
May / June 2023 – 51
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