Super fund developer Cbus Property has snared a prize residential site in inner-city West Melbourne just days after putting its foot on a $100 million boutique project nearby.
The 1700-square-metre island site is bounded by Dryburgh Street and Ireland Street in West Melbourne, not far from the popular Errol Street shopping strip and close to the North Melbourne station.
Cbus Property acquired the property from private investors for around $12 million in an off-market deal through Colliers International.
The super fund developer has been steadily building its residential prospects as the commercial property development cycle peaks and demand for apartments remains strong.
Last month, Cbus Property took over a 138-apartment project, on the corner of Capel Street and Queensberry Street in nearby North Melbourne, for $17 million.
Chief executive Adrian Pozzo said the group was stoking its pipeline with residential opportunities as demand for new commercial space slowed.
“In principle, everyone has now moved until the next cycle. We envisage the next cycle will be around 2018, or 2019 or 2020,” Mr Pozzo said.
At the same time, residential demand in Sydney and Melbourne is healthy, despite concerns in some quarters of a potential oversupply.
“We believe there is a market there. You get the right position and the right property and it will sell,” Mr Pozzo said. “We develop to meet the market. There is no set formula.”
The developer has clearly demonstrated that demand, all but selling out the 270 apartments it offered at its 35 Spring Street tower in Melbourne, overlooking the Treasury Gardens.
In Sydney, Cbus Property is pursuing plans for a residential tower overlooking Hyde Park, at 130 Elizabeth Street. The 35-storey project will offer 154 apartments above ground-floor retail.
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