Suburban park goes for $45m

The joint venture is negotiating to pay about $45 million for the Greenwood Office Park at 301 Burwood Highway, at the north-east corner of Station Street.

Greenwood was quietly sold by Industry Superannuation Property Trust. Representatives from ISPT and the joint venture did not return calls.

The sale price reflects a high yield of about 11%, and is far less than the $47 million book value ISPT gave the park five years ago.

As well as slow economic conditions, sources say Greenwood's purchase price was affected by two short-term leases to major tenants, Deakin University and Telstra, which occupy space in two of the three buildings.

Deakin is believed to have since recommitted to Greenwood, which is only a few hundred metres from the university's main Burwood campus at 221 Burwood Highway.

The most recent deal reported at Greenwood was last year, when corporate travel services company Hogg Robinsons Group subleased 940 square metres for about $220 a square metre.

Digital and photographic products and service provider Agfa-Gevaert also leases space at Greenwood.

CB Richard Ellis director Andrew Dawkins is believed to have sold Greenwood, but declined to comment. Knight Frank is also believed to be involved in the deal.

Greenwood includes almost 20,000sqm of offices and 976 car parks and sits on a 3.4-hectare block.

ISPT bought Greenwood as an investment in 1995, paying $49.5 million.

During the recent off-market sales campaign, Melbourne-based developer and fund manager Drapac is also believed to have thrown its hat in the ring to buy Greenwood.

It is believed the new owners will rework the car park and improve the existing restaurant and cafe. It could not be confirmed whether Banco might develop a new building on part of the prominent corner site.

Banco develops medium to large commercial and residential projects.

In the outer eastern suburb of Notting Hill, Banco is developing an 8970sqm office building at 660 Blackburn Road. It has also built offices in Kew, North Melbourne and Coburg, and is proposing a major residential and retail redevelopment in Smith Street, Collingwood.

Interests associated with the Smorgon family paid about $22million for an office building investment at 64-78 Trenerry Crescent in Abbotsford in December.

KEY POINTS

- Banco and Smorgon joint venture buys office park in Burwood.

- Greenwood includes almost 20,000 square metres of offices and 976 car parks.