Melbourne’s prominent Spaghetti Tree building in the heart of the CBD has been listed for sale for the first time in 42 years, with price expectations of more than $7.5 million.
The iconic corner building, located, at 59-63 Bourke Street, is home to the popular Spaghetti Tree restaurant and is scheduled to go under the auctioneers hammer on December 18.
Photo courtesy of Google.
The four storey brick and concrete building has three existing tenancies all held under continuing leases, generating an estimated annual net income of $310,000.
The principal tenancy over the ground and first floor spaces is to Spaghetti Tree which has been in occupancy for some 25 years.
The current lease commenced in November 2011 for four years and includes one further four year option, at a current net rental of $229,000. The restaurant tenancy is also responsible for a portion of the building outgoings. Included in the lease terms are CPI annual increases with a market review on exercise of the option.
The second level is leased to the Asian themed Asuka Karaoke Bar, which has an annual rent of $64,502.
The third floor tenant is iconic Melbourne rooftop bar Madame Brussels.
The tenancy is under a five year lease that commenced from June 21, 2011 with one further option of five years. The lease has 4% annual rental increases and a market review at the expiry of three years.
The upper level of the third floor plus the adjacent rooftop terrace is home to the Madame Brussels bar, nightclub and entertainment venue.
The occupancy is under a six year lease that commenced from December 1, 2011 with one further option for another six years.
Selling agents Kliger Wood Real Estate, in conjunction with Gross Waddell have been instructed to sell the property on behalf of the vendor, a private family.
The agents highlighted that the location was a key restaurant and theatre precinct and as a freehold site there was potential to subdivide into strata units (STCA).
“The corner location adds future redevelopment potential again subject to relevant permits,” they said.
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