Privately owned APH Holdings has snapped up one of the last major development sites in the northern corner of the Melbourne CBD and unveiled plans to build a high-rise hotel as well as a mix of ground-floor hospitality offerings.
The busy developer, whose other Melbourne projects include a $1 billion suburban office park and a $1 billion health precinct in the city’s eastern suburbs paid more than $40 million for the neighbouring sites of 441-445 Elizabeth Street and 447-451 Elizabeth Street, as well as an adjoining site, 139-141 Franklin Street, that include the 1858-built Royal Saxon Hotel and another historical property, the brick and bluestone Menzies International building.
Combined, the three sites create a 1530-square-metre T-shaped development site that includes an existing permit for a 32-storey mixed-use tower.
APH Holdings is acquiring the three properties from Yew Kiong Ling and See Song Yew of Goodyear Properties, who back in 2014 had hoped to add 445 apartments to what was then a flood of high-rise projects being developed along and just off Elizabeth Street by the likes of Golden Age Group, Brady Group and Malaysian outfits Mammoth and SP Setia.
APH’s plans are to build a 34-storey hotel as well food and beverage facilities across the site by late 2023 or early 2024.
The developer, led by CEO Johnson Zhang, also owns a 10-storey commercial building across the road at 440 Elizabeth Street, purchased for $75.6 million in 2016. The developer plans to turn this into a medical care facility under its Wellington Health brand.
Colliers agents Oliver Hay, Leon Ma, Matt Stagg, Daniel Wolman and Trent Hobart brokered the latest sale after an expressions-of-interest campaign generated 10 bids from local, interstate and offshore developers.
Mr Hay said the large number of infrastructure projects under way nearby including the new State Library and Parkville Metro train stations and the $250 million renewal of Queen Victoria Market as well as $3 billion worth of residential, hotel and commercial developments, had underpinned interest in the Elizabeth and Franklin street sites.
APH Holdings’ acquisition of the CBD site comes after it secured the Victorian government’s Eastern Health as the anchor tenant for the first stage of its $1 billion Wellington Health precinct in Box Hill.
The public healthcare provider, which operates the neighbouring Box Hill Hospital, has signed a 40-year lease for 15,000 square metres of medical space in stage one of the development, which is under construction and due for completion by mid-2024.