Hong Kong-listed developer Far East Consortium has shrugged off negative sentiment around the housing market to take over a 68-level apartment project in central Melbourne in a $90 million deal.
Far East’s move effectively represents the first sign of a big player positioning for the next stage of the housing cycle even as other major players – such as Jeff Xu’s Golden Age and Singapore’s Fragrance – are still beating their retreats from residential projects in the Melbourne CBD.
Far East has bought 640 Bourke Street, a property which comprises the historic Eliza Tinsley building, and above it a towering residential skyscraper with approval for 813 apartments.
640 Bourke Street in Melbourne comes with approval for a residential skyscraper. Tim Shaw
The Hong Kong-listed player already has a multi-tower complex well advanced on nearby Spencer Street which will include first Ritz-Carlton hotel in Melbourne.
Far East described the acquisition as “fair and reasonable having taken into account the potential development value, location of the property and prevailing market conditions”.
“The acquisition is consistent with the group’s regionalisation strategy and allows the group to replenish its landbank in Melbourne, having pre-sold the majority of its available residential units at West Side Place, which is a mixed-use development by the group featuring four residential towers and two hotels,” it said.
“The group intends to redevelop the property, which is situated in a prime residential location in the Melbourne CBD close to public transport and other key amenities, into a residential tower.”