Major residential village planned for Armadale

Lend Lease confirmed it had entered a joint venture to redevelop the 2.5-hectare office site at 590 Orrong Road with Mr Hargrave's Larkfield Holdings, the owner of the land.

The site is bordered by Orrong Road, Osment Street and the northern boundaries of Victory Square Reserve and Toorak Park. It abuts the Toorak railway station to the east, and a pedestrian bridge to the small Beatty Avenue retail strip. Sources speculate the property could make way for several high-rise apartment towers that would capitalise on park and city views. They say the project could have an end value of more than $200 million, but the proposed scale could not be confirmed with Lend Lease.

"A master planning process and review of optimal site uses will be undertaken prior to lodging a planning permit application, and the joint venture is committed to involving the local community and stakeholders in the planning process," Lend Lease general manager of business development Maurice Cococcia told Capital Gain.

The property has been identified as a large redevelopment site by the City of Stonnington in its strategic framework plan, and a potential residential development site by the State Government's Urban Development Program.

Colliers International director Rob Joyes, who is thought to have introduced Lend Lease to Larkfield, declined to comment.

Larkfield's commercial portfolio also includes assets in Port Melbourne, Box Hill and the western suburbs, according to sources.

Low-rise offices on the Orrong Road site have been occupied for years by engineering science and project delivery company Sinclair Knight Merz, thought to be relocating to 452 Flinders Street.

Echoes of Hollywood

THE South Yarra motel at the centre of a saucy scandal involving Hollywood actress Ava Gardner and crooner Frank Sinatra 50 years ago is for sale.

Rooms within the St James Motel, at 35 Darling Street, accommodated Gardner and a production crew during the 1959 filming of end-of-the-world movie On the Beach.

It was reported that Sinatra would often visit Gardner during filming, despite the fact the couple divorced two years earlier. Sinatra left his wife and children in 1951 to marry Ms Gardner, who had been married twice before.

St James is being marketed as a development site and may be demolished to make way for a higher-density apartment project. The building on the site is configured as 16 bedsit-style apartment rooms, and is leased to hotel operators until March. Kay & Burton director Andrew Baines expects the

St James Motel to sell for about $2.75 million.

Up and up in Richmond

RICHMOND's tallest office building will be developed on a site at the busy on-ramp between Punt Road and the Monash Freeway.

The Victorian Civil and Administrative Tribunal has given Melbourne-based developer Caydon the green light to build a nine-storey office on the site of the former Viva Plastics warehouse, on the north-east corner of Harcourt Parade and Cremorne Street, next to the famous Nylex sign and silos.

Caydon paid $6.15 million for the 3050 sq m site. Its $50 million office proposal will add 9420 sq m of high-end office space to the Cremorne pocket of Richmond.

Caydon sales manager Robert Evans told Capital Gain that Cremorne was "an untapped location, with so much diversity and amenity available."

Caydon had originally hoped to develop a 12-storey office on the site, but this was rejected by the City of Yarra, whose decision was upheld by VCAT. According to the council, the nine-storey building will be the tallest office in the suburb.

New Hive of activity

INNER-CITY retail strip Victoria Street, at the border of Abbotsford and the precinct known as North Richmond, has attracted a second major retail tenant.

Woolworths this week confirmed a 20-year, 4000 sq m retail lease at Hive, a $50 million shopping centre and residential project, being developed on a 5000 sq m site on the north-west corner of Nicholson Street.

Woolworths will join rival Aldi, a large pharmacy and 22 specialty retailers at Hive, which is due to open in February.

Hive is being developed on a site that once included what was once the service and sales delivery centre for Kevin Dennis Motors. Ben Genser, director of developer Belgrave Group, said he expected Hive, which will include 300 car spaces, to radically enhance the area, which is best known for its concentration of Vietnamese restaurants and fruit shops and butchers.

"The co-location of both Woolworths and Aldi will be a first for inner-Melbourne and will bring much welcome competition and a point of difference to a Coles-dominated Richmond," said Mr Genser.

The closest competing Coles supermarket is at the Victoria Gardens shopping centre, a couple of kilometres away. Woolworths is a majority owner in Australian Leisure and Hospitality Group, which this week paid $19 million for the St Albans Hotel in Melbourne's west.

CBD sale speculation

ANOTHER CBD office may be close to sale, this time in La Trobe Street.

Sources say the 19-year-old, 14,300 sq m former Customs House office at 414 La Trobe Street is in advanced negotiations to be sold to a private investor for about $55 million, far less than the $67 million the owner, British fund manager New Star International Property, paid Investa for the office last March.

The 18-storey building, opposite Flagstaff Gardens, was quietly listed for sale earlier this year, about the same time as a swag of other CBD offices, including 303 and 350 Collins Street, and a half-share interest in 1 Spring Street, all of which have sold.

CB Richard Ellis' Mark Costa and Martin O'Sullivan are handling the La Trobe Street campaign, but they declined to comment to Capital Gain on any part of a deal.

New airport landmark

SPOTTING Melbourne Airport from an aircraft window might be easier within a couple of years.

Plans have been lodged with the Hume City Council to develop an 11-storey office tower at a site abutting the airport, at 257 Melrose Drive.

A council spokeswoman confirmed the application would include three storeys of basement car parks and offices over the top eight storeys.

The once-vacant tracts of land around Melbourne Airport have been developed over the past 20 years as the airport has expanded.