CASE STUDIES

446 Collins Street, Melbourne

 

Purchase price: $33.76m

Sale price in 2021: $72.62m

Net gain for investor: 164%

Total return: 27% per annum

Hold period: 6 years

Premium to valuation: 17%

 

446 Collins Street was acquired by Vantage on behalf of a private offshore investor. Throughout our ownership period, capital works included a full upgrade of the HVAC, a building management system, installation of end-of-trip facilities, refurbishment of the foyer and upgrade to various on-floor amenities. Since acquisition, we negotiated 18 new leases resulting in an 84% average rent increase on pre-acquisition rents. The property was sold off-market at a 17% premium to valuation.

26-28 Prospect Street, Box Hill

 

Purchase price: $5.9m

Sale price in 2021: $17.16m

Net gain for investors: 300%

Total return: 16% per annum

Hold period: 19 years

Premium to most recent valuation: 12%

 

26-28 Prospect Street was acquired on behalf of a syndicate of investors in 2002. During our ownership, we experienced some very successful periods, whilst also navigating through some challenging times including the GFC and more recently, the COVID-19 pandemic. A key management initiative in the last 12 months of ownership was the successful application for a 30-level mixed use planning permit. Due to the proposed planning scheme changes, a permit of this scale would no longer be possible under the new scheme. This approval broadened the appeal of the asset to a deeper pool of potential buyers and was a determining factor in achieving the highest land rate ever recorded on Prospect Street.  The property was sold at a 12% premium to the most recent valuation.

541 Blackburn Road, Mt Waverley

 

Purchase price: $8.15 million

Sale price in 2020: $21.83 million

Net gain for investors: 224%*

Hold period: 17 years

Total return for investors: 19% per annum*

Premium to valuation: 30%

 

541 Blackburn was purchased in 2003 on behalf of Australian-based high net worth individuals and self-managed super funds. Vantage managed the refurbished all base building amenities, common floor lift lobbies, the main entry lobby and fully upgraded the heating, ventilation and air conditioning system during its ownership. At the point of sale the asset was 100% leased to premium and diversified tenant mix with a robust WALE of 3.83 years.

420 St Kilda Road

 

Purchase price   $68.84m

Sale price in 2019   $98 million

Net gain for investors  41%

Hold period    2 years

Premium to valuation  31 per cent *

 

420 St Kilda Road was acquired by Vantage in partnership with private equity firm KKR as a value add/opportunistic real estate investment.  During our short ownership we completed a major capital refurbishment program including ground floor foyer, lift upgrade. Installation of a high quality end of trip facility and other on floor tenancy works.  During our ownership we grew rental levels by 58% on pre-acquisition levels and disposed of the property to an offshore private investor.

Diversified Number Two - Box Hill / Mulgrave

 

Purchase price   $14. 5 million

Sale price in 2017   $24.5 million

Net gain for investors  82 per cent *

Hold period    6.75 years

Total return for investors  12.15 per cent per annum *

Premium to valuation  36.1 per cent *

 

Vantage acquired properties during the global financial crisis to capitalise on market conditions. These were bought at well below replacement cost. Vantage repositioned the assets through cosmetic refurbishments and also by splitting floors, exposing ceilings and polishing concrete floors. This differentiated our offering from competing spaces in these markets. We secured strong leases across the portfolio and a weighted average lease expiry of three years.

247 Collins Street Melbourne

 

Purchase price   $22.68 million

Sale price in 2017   $35 million

Hold period    2 years

Net gain for investors  74.41 per cent *

Total return for investors  37.21 per cent per annum *

Premium to valuation  45.83 per cent *

 

This property was acquired for a single offshore listed investor. Vantage’s role was to buy a suitable property, undertake refurbishment, fully lease the building and sell it within two years. When purchased, 247 Collins Street was vacant and needed significant refurbishment. Vantage fully leased the seven-level office and retail building within 12 months. It was sold fully leased with a weighted average lease expiry of close to 10 years.

620 Church Street Richmond

 

Purchase price   $8.25 million

Sale price in 2016   $23.3 million

Hold period    15 years

Net gain for investors  468.74 per cent *

Total return for investors  30.85 per cent per annum *

Premium to valuation  38.7 per cent *

 

This was a pooled investment trust for individual high net worth investors. The property was repositioned several times throughout our 15-year ownership with significant refurbishment works done to enhance income returns and create a greater retail amenity allowing a premium rental.  Later, Vantage obtained a town planning permit for additional accommodation on the roof of the property.  Long-term leases were stuck over the office accommodation and the property was sold off market at a 40 per cent premium to valuation.

533 Little Lonsdale Street Melbourne

 

Purchase price   $19.5 million

Sale price in 2016   $35.25 million

Hold period    3 years

Net gain for investors  79.20 per cent *

Total return for investors  26.4 per cent per annum *

Premium to valuation  30.6 per cent *

 

This was a pooled investment trust for individual high net worth investors. This property presented very poorly at the time of acquisition as it had been run down by the previous owners. Vantage undertook a $2.4 million refurbishment. This comprised refurbishing the ground floor, common area lobbies and tenancy areas as well as replacement of the lifts and air-conditioning system. We grew passing rents at the property by 43 per cent and sold the property three years after purchase off-market for 30 per cent above the valuation.

Diversified Number One
-  Epping, Notting Hill, Keysborough

 

Purchase price   $14 million

Sale price in 2015   $17.6 million

Hold period    4.5 years

Net gain for investors  77.60 per cent *

Total return for investors  17.24 per cent per annum *

 

This was a pooled investment trust for individual high net worth investors. The trust was established during the global financial crisis when industrial yields had plummeted and Vantage felt industrial property offered the best return on a risk weighted basis. We acquired three industrial facilities and renegotiated the leases to provide for a very attractive four-year weighted average lease expiry. Vantage disposed of these assets when market fundamentals turned and industrial property became highly sought after.

43 Elizabeth Street Melbourne

 

Purchase price   $4.1 million

Sale price in 2013   $15.5 million

Hold period    13 years

Net gain for investors  224.90 per cent *

Total return for investors  17.3 per cent per annum *

 

 

43 Elizabeth Street was a pooled investment trust for individual high net worth investors. Vantage undertook significant refurbishment to the ground floor foyer and the building’s operational system. Reconfiguring the foyer provided greater retail exposure and enhanced income potential. Vantage secured long-term leases for all retail areas and increased the building income by 250 per cent.

*Past performance is no indicator of future returns.  Please consult your financial advisor before considering an investment with Vantage.