Melbourne property player Harry Stamoulis will take advantage of heightened investor interest in the commercial office sector, moving to list two city buildings on Williams and Spencer streets.
A 12-level office building at 277 William Street and a 23-storey building at 120 Spencer Street, both owned by Mr Stamoulis, are expected be offered through CBRE towards the end of June, industry sources said.
The offloading of Stamoulis' assets is expected to be followed by another campaign in July for 460 Lonsdale Street, owned by Retail Employees Superannuation, which has been mooted to hit the market since late last year.
The 18 levels at 460 Lonsdale are leased to the Commonwealth Director of Public Prosecutions and Jirsch Sutherland among others and are split between offices on the upper 10 storeys with eight levels of car parking underneath.
The shift in focus towards secondary stock has been driven by a surge of offshore interest in Australian commercial real estate and a lack of premium office buildings being traded.
The gap between core and secondary assets has narrowed considerably over the past six months because of the weight of capital and lack of stock, agents say.
Capital rates for premium buildings had compressed sharply, to below 6 per cent, and secondary B-grade assets were now breaching 7 per cent.
Recent Foreign Investment Review Board figures reveal China is now Australia's biggest offshore buyer of property, spending $12.4 billion in 2013-14 - more than double the $5.9 billion it spent in the previous year.
The volume of Asian capital looking for a property was not expected to wane soon.
A KPMG China Studies Centre and Knight Frank report suggests a fourth wave of Chinese investors, made up of the Chinese super-rich and private developers, is poised to enter the Australian market.
Where previous investors pursued core trophy assets, particularly Sydney or Melbourne office towers, the new wave is looking for opportunities in other cities and other asset classes, including retail and hotels.
The report found Chinese investors and developers are looking to offshore investments to diversify risk and look favourably on Australia's liquid and transparent markets.
New rules instituted by the Foreign Investment Review Board were not expected to have a negative impact on their activity.
At least seven large offices are actively being traded in Melbourne's CBD.
Savills Australia and Colliers International are midway through a campaign to offload AMP Capital Wholesale Office Fund's premium 30 level building at 222 Exhibition Street.
It's expected to fetch up to $220 million.
Another sought-after office at 114 William Street owned by private developer and investor Kyko Group has attracted significant local and offshore interest.
A Colliers International and CBRE deal has resulted in 575 Bourke Street going into due diligence by Malaysian fund manager CIMB TrustCapital Advisors for about $90 million.
Another well-known commercial property at 161 Collins Street owned by giant German investor SachsenFonds is also in due diligence on an asset expected to be worth $250 million.
