European Bier Cafe: Trophy pub looking for a trophy price

Australia Post is off-loading its Fitzroy business centre post office at 371-385 Gore Street after nearly 30 years.

Records show it paid just $400,000 for the 1192 sq m site during the depths of the 1992 recession – it’s now worth around $8 million.

JLL are understood to be marketing the property, which is on the corner of Argyle Street, one block away from busy Johnston and Smith streets.

Word around the traps is Auspost is embarking on another property disposal program. “The property located at Gore Street Fitzroy will be advertised for sale, subject to a leaseback arrangement with Australia Post, later this month,” a Post spokeswoman said.

Its latest annual report shows its land and buildings portfolio is worth $1.7 billion.

The Fitzroy site is in a very hot pocket with several building projects replacing the suburb’s former industrial stock, including Shane Wilkinson’s Pace down on the Johnston Street corner.

Niagra Lane

The first CBD auction for the year took place last week in a classic Melbourne laneway location.

More than 150 people turned up for the auction of 27 Niagra Lane which fetched $3 million after bidding from five parties.

JLL agent Josh Rutman said there were 220 inquiries and 58 inspections of the two-storey historic property during the campaign.

“There were some purchaser concerns about heritage aspects of the building coupled with the lack of income,” Mr Rutman said.

“But there aren’t many buildings coming up in the CBD for under $5 million,” he said.

The 250 sq m warehouse was built in 1887 as part of a chain of furniture warehouses. It was first renovated in 1887 and has been refurbished several times since and converted into offices.

The vendors owned the Trans World Travel business which closed down during the COVID-19 pandemic.

Katherine Place

There’s been plenty of turnover at Katherine Place, the lunchtime strip at the foot of Brendan Sullivan’s revamped strata office project at the western end of Flinders Lane.

A Chinese-based investor has reportedly splashed out nearly $5 million on four shops in the foodie precinct.

Back in January CBRE agents JJ Heng, Alex Brierly and Nathan Mufale and Tuxworth Property’s Tom Tuxworth sold Delhi Streets at No.18 for $1.675 million on a 4.65 per cent yield ($27,459 a sq m) and Hunters’ Roots at No.26 for $1.575 million on a 4.75 per cent yield ($30,155 a sq m). The two restaurants had recently renewed five and six-year leases.

The Chinese investor reportedly returned in March and snapped up a further two restaurants – 1/517 Flinders Lane for $940,000 ($49,474 a sq m) and 28 Katherine Place for $759,263 ($36,155 a sq m).

They have just listed Mr Huang’s at No.24.

Mr Mufale said “It’s a really positive sign for the city. Investors are taking a long-term view on the return of office workers, students and tourists.

Meanwhile, Lau’s Cafe at 535 Flinders Lane, in the same precinct, sold two weeks before auction to a local private investor on a very sharp 3.2 per cent yield.

Stonebride agents Dylan Kilner and Max Warren said the cafe fetched a building rate of more than $35,000 a sq m which puts the undisclosed sale price of the 18 sq m cafe at around $630,000.

Records show it was bought for $272,500 in 2013 on a yield of 5.2 per cent.

Just six months remain on the lease but with more than $190 million of hotel development in the immediate area, buyers were focused on the long term, Mr Warren said.

Nicole Lindsay is a property reporter at The Age.