LOW interest rates and increased interest from Asian investors is driving growth in Melbourne's strata office market, according to CBRE.
An analysis from the real estate agency shows a 25 per cent lift in value over the past 12 to 18 months, following a number of significant transactions.
CBRE managed the sale of level 3, 171 La Trobe Street which fetched $2.05 million in March, a 22 per cent lift in value compared to its original purchase price in 2013.
CBRE Melbourne Strata Projects negotiator Tim Last says a combination of low interest rates, SMSF purchasers and increased Asian investment have amplified demand.
"CBRE Melbourne Strata Projects has noticed a 35 per cent increase in enquiries over the last three months, which we believe can be directly correlated to the interest cuts and buyer confidence," Last says.
Chinese investors recently snapped up three offices within a week, including the sale of an office unit at Flinders Lane for a building record of $880,000.
While local buyers are making the most of favourable economic conditions, following the sale of level 3, 4-10 Bank Place for $1.32 million on behalf of Sky Bus Australia.
Owner occupiers also continue to acquire space for commercial use, including The Face Group's purchase of level 4, 11-19 Bank Place to gain a foothold in the burgeoning area.
Get our daily business news
Sign up to our free email news updates.
Help us deliver quality journalism to you.
As a free and independent news site providing daily updates
during a period of unprecedented challenges for businesses everywhere
we call on your support