Prominent Bondi developer RnB Property Group is making its mark in Byron.

The developer, who is currently delivering boutique developments Mangata and Allara in Vaucluse, has filed for a boutique shoptop development on Byron Bay's dress circle Marvell Street.

The near $11 million plans, for an amalgamated site across 5 Marvell Lane and 8 Marvell Street, will see 10 three-bedroom apartments developed across a four-level building, above two ground floor retail spaces and basement parking, accessed from Marvell Lane.

<img alt="Marvell Ln, Byron Bay 2481 NSW" data-entity-type="file" data-entity-uuid="621b55e5-5b0a-40c0-984a-47d716814e1b" src="https://s3.ap-southeast-2.amazonaws.com/www.urban.com.au/s3fs-public/inline-images/Byron%20bay%20da%20pers.png?VersionId=MJyJqMzfMqom4a.l9EIiIZW8cYP24Mf1" />

The apartments, designed by&nbsp;SRH Architecture, will range in size between 114 sqm and 220 sqm.

SRH’s architectural plans indicate a contemporary façade treatment with varied setbacks to address both Marvell Street and Marvell Lane frontages.&nbsp;

Landscaped common areas are proposed, including 134 sqm of gardens, while deep planting is incorporated to improve the interface with surrounding properties.

BASIX commitments show the project exceeding NSW sustainability targets, achieving a water score of 49 against the target of 40, and an energy score of 61 over the target of 60. All apartments have been designed to achieve compliance with thermal performance standards.

<img alt="Marvell Ln, Byron Bay 2481 NSW" data-entity-type="file" data-entity-uuid="be1365f4-91b0-4c79-9e30-b91c6867140b" src="https://s3.ap-southeast-2.amazonaws.com/www.urban.com.au/s3fs-public/inline-images/Marvel%20St%20byron%20bay.png?VersionId=PXxTyxp.HkNEQxiIwuUDlbQn2f.UC_l5" />

The development would involve the demolition of a single storey cottage on the site.

RNB Property Group has developed across Sydney's affluent eastern suburbs for decades. They met with the Byron Bay Council prior to the recent submission. They only received one written submission from locals, who requested a redesign of the building to respond more&nbsp;to the local context through form, material palette and native landscaping.

Changes to aspects of the design have been undertaken in response to the feedback.

Joel Robinson

Eastern Suburbs developer heads north to Byron's Marvell Street

Once home to MacRobertson’s Garage and Workshop, a small corner of <a href="https://www.apartments.com.au/developments/fitzroy-vic-3065">Fitzroy</a> is soon to host a new sculptural landmark, with its design intent rooted in the textures and stories of the streets around it.

Developed by <a href="https://www.apartments.com.au/developers/chapter-group">Chapter Group</a> in partnership with <a href="https://www.apartments.com.au/developers/cdl-australia">CDL Australia</a> and <a href="https://www.apartments.com.au/developers/crema-group">Crema</a>, <a href="https://www.apartments.com.au/new-apartments/fitzroy-fitzroy-411-421-smith-street-fitzroy-vic-3065">Fitzroy Fitzroy</a> comprises 63 one, two, and three-bedroom apartments behind the heritage brick façade.

&nbsp;

[smartcode_project:default project_id=14394 project_image_fid=183064]

<a href="https://www.apartments.com.au/architects/dko-architecture">DKO Architecture</a> led the design process with a clear vision.

“What really inspired our vision for Fitzroy Fitzroy was to create almost a sculpture that could sit on the actual heritage base itself,” says Koos de Keijzer, Founder and Principal at DKO.&nbsp;

The design team shaped the western side of the nine-storey building into a chamfer, opening interiors to light and views while defining the building’s distinctive form.

The façade’s rhythm is broken by recessed loggias.

"We feel quite strongly about loggias, an outside area that sits inside and is quite protected from the wind and from the sun. We've also got these Juliet balconies where&nbsp;the wall starts to open up just to captivate the outdoors and bring it indoors.”

&nbsp;

[smartcode_project:default project_id=14394 project_image_fid=183066]

Inside, DKO crafted flexible layouts to encourage residents to live their own way.

“We really wanted to create something which people have an individual say on how they live,” says Michael Drescher, DKO's Interior Design Director.

Kitchens feature two contrasting stones, a durable surface at the cooktop and a natural stone island, with abundant storage and built-in banquet seating to encourage shared meals and socialising.&nbsp;

[smartcode_project:default project_id=14394 project_image_fid=183071]

Bathrooms carry the same stone for a cohesive aesthetic, informed by hotel design cues to create “a high level of glamorous” while remaining highly functional.

On levels seven and eight, apartments are tucked behind the building’s chamfer, creating outdoor terraces that range from expansive entertaining areas to sheltered, intimate spaces beneath the pitched rooflines.&nbsp;

[smartcode_project:default project_id=14394 project_image_fid=1010]

Residents also have access to a rooftop retreat with panoramic views, alongside the Smith Club, a private lounge for social gatherings, and a laneway arcade linking Smith and Leicester Streets, a deliberate nod to Melbourne’s arcade culture.

For de Keijzer, the outcome is a project that feels inherently local, that that is “truly authentic in a Fitzroy context”.&nbsp;

Fitzroy Fitzroy is already 70 per cent sold, attracting predominantly local owner-occupiers. <a href="https://www.apartments.com.au/builders/cobild">Cobild</a> is expecting to complete construction in Q4 2025, with residents moving in shortly after.

[smartcode_project_cta:default project_id=14394]

For Koos de Keijzer, Founder and Principal at DKO, the outcome is a project that feels inherently local, that that is “truly authentic in a Fitzroy context”

Fitzroy Fitzroy: Designed by locals, rooted in place

Chevron Island is set for a little slice of New York with the upcoming completion of Greenwich, the newest development by Ention Properties.

<a href="https://www.apartments.com.au/new-apartments/greenwich-surfers-paradise-30-anembo-street-surfers-paradise-qld-4217">Greenwich</a>, a boutique 15-level development with just 46 apartments on Anembo Street, just off Chevron Island Park, has been designed by Ferro Chow to look like Manhattan's famous Flatiron Building.

[smartcode_project:default project_id=6647 project_image_fid=171555]

Ention has refined the design and the make-up of the building over several years, reducing the number of apartments and increasing the internal floor areas of the apartments.

The remaining apartments for sale, which start from over 100 sqm and range in size up to the 209 sqm, penthouse-style offering, start from just over $1,129,000. There are a handful of two and three-bedrooms remaining, each with views over the Gold Coast skyline and waterways from the balconies and living areas.

[smartcode_project:default project_id=6647 project_image_fid=183797]

<a href="https://www.apartments.com.au/architects/ferro-chow-architects">Ferro Chow Architects</a> led the design, placing emphasis on curved forms, expansive arched floor-to-ceiling windows, and a natural palette that connects the interiors with the parkland and river landscape.&nbsp;

Each apartment features wide-plank oak flooring and a refined materials palette, including marbled stone kitchens and premium Miele and V-ZUG appliances.&nbsp;

[smartcode_project:default project_id=6647 project_image_fid=183798]

Greenwich’s amenity is anchored by a rooftop pavilion dedicated exclusively to residents, comprising an infinity-edge pool, daybeds, poolside cabanas, a BBQ area, and a yoga and relaxation lawn.

The elevated vantage point offers sweeping city and water views, complementing the project's positioning at the quiet residential end of Chevron Island, but also just off the Thomas St village strip.

Jayde Pezet, Director at Pezet Matheson, says buyers have been drawn to the central location of the development, abutting public open space, with water and skyline views.&nbsp;

"Greenwich offers residents unparalleled walkability to HOTA, waterways, Surfers Paradise golf course, beaches and dining precincts.&nbsp;Also the stunning architectural design of the towers facade coupled with exquisite rooftop amenity has drawn attention from buyers and local residents alike."

[smartcode_project_cta:default project_id=6647]

Jayde Pezet, Director at Pezet Matheson, says buyers have been drawn to the central location of the development, abutting public open space, with water and skyline views

Ention Properties release final Greenwich, Chevron Island apartments ahead of September completion

Three years after completion, <a href="https://www.apartments.com.au/buildings/the-lennox-parramatta-12-phillip-street-parramatta-nsw-2150">The Lennox</a> on the Parramatta River remains one of the suburb's most distinctive residential towers, not just for its 46-storey presence on the water, but for its integration of the Southern Hemisphere’s first fully robotic car park, now well-proven in daily use.

Delivered by <a href="https://www.apartments.com.au/developers/novm">NOVM</a> and EQ Construction and designed by <a href="https://www.apartments.com.au/architects/marchese-partners">Marchese Partners</a>, the $300 million development brought 414 apartments to Parramatta’s CBD fringe at a time when the city was undergoing rapid transformation into Sydney’s second CBD.

The nine-level basement, combining three conventional parking levels with six automated levels, was designed and installed by German firm Lödige Industries using its Cubile technology. The system has now been in continuous operation for three years, handling 327 vehicles through five transfer cabins.&nbsp;

[smartcode_project:default project_id=5743 project_image_fid=5369]

Residents drive into the cabins, and flat robots move their cars to available bays without ramps or human intervention. The technology is compatible with all common cars and SUVs up to 2.5 tonnes and typically retrieves vehicles within minutes via a smartphone app.

By storing up to 60 per cent more vehicles than a conventional design, the automated format reduced excavation depth during construction and continues to deliver operational benefits, including lower emissions from underground vehicle movements and improved resident safety.

NOVM CEO and Executive Director Adrian Liaw said the decision to adopt the technology was aligned with the team’s focus on both efficiency and resident experience.

“For The Lennox we wanted both a modern functionality and timeless aesthetic combined with our customary meticulous quality and craftsmanship. The automated parking technology from Lödige Industries offers both the innovative functionality and luxurious user experience we were keen to create and the performance we needed to see.”

[smartcode_project:default project_id=5743 project_image_fid=5371]

The Lennox offers a mix of one, two, three and four-bedroom apartments, all designed with open-plan living areas that extend to private balconies.&nbsp;

Interiors are finished in neutral tones, complemented by engineered timber flooring, stone benchtops and integrated appliances, while many residences on the upper levels enjoy expansive river and district views.

Resident facilities are centred around The Watermark precinct, a 20-metre indoor heated pool, outdoor terrace, BBQ areas, gym, fitness studio and conference room. Ground-floor retail fronts the river walk, linking directly to public open space.

[smartcode_project:default project_id=5743 project_image_fid=5370]

Since The Lennox’s completion, Parramatta has continued to experience population growth and infrastructure investment, with the light rail under construction and the Metro West line expected to link the CBD to Sydney in around 20 minutes.&nbsp;

Waterfront residential opportunities remain limited, with most prime sites either developed or earmarked for public use. In a market where on-site parking ratios are trending down in new approvals, The Lennox’s combination of a high-capacity robotic car park and established riverfront address continues to differentiate it among completed stock.

A limited selection of apartments at The Lennox remain available, with immediate occupancy.

[smartcode_project_cta:default project_id=5743]

Riverfront living with Australia’s most advanced residential parking system at The Lennox, Parramatta

Melbourne-based developer <a href="https://www.apartments.com.au/developers/progressio-developments">Progressio Developments</a> has timed the launch of its latest residential project to perfection.

Their new development, <a href="https://www.apartments.com.au/new-apartments/crest-camberwell-936-938-toorak-road-camberwell-vic-3146">Crest Camberwell</a>, taps into a significantly undersupplied market in Camberwell, where new apartment projects are increasingly rare. Progressio is not only filling that gap but also catering to a broader range of buyers—something that's uncommon in boutique apartment buildings, which typically feature uniform configurations and price points.

Located on a prime Toorak Road site, just a short walk from the bustling Burke Road commercial strip, Crest Camberwell comprises just 12 exclusive apartments.

[smartcode_project:default project_id=9177 project_image_fid=350647]

Prices at <a href="https://www.apartments.com.au/new-apartments/crest-camberwell-936-938-toorak-road-camberwell-vic-3146">Crest Camberwell</a> start at $770,000 for the one-bedroom apartments. The two-beds are priced at $1.49 million, and the large three-bedroom residences, with two parking spaces, are $1.66 million.

Designed by Melbourne-based architecture studio <a href="https://www.apartments.com.au/architects/splinter-society">Splinter Society</a>, Crest’s architectural expression draws on Camberwell’s heritage character, incorporating brick-inspired materials and bronze detailing.&nbsp;

The building’s massing and orientation are designed to capture green views while integrating with the established streetscape.&nbsp;Natural materials including travertine, textured concrete and timber feature throughout, both externally and internally.

[smartcode_project:default project_id=9177 project_image_fid=350647]

The interiors prioritise scale and natural light, with open-plan layouts that extend to large balconies equipped with full-height sliding doors.&nbsp;

Integrated appliances from Fisher &amp; Paykel and V-ZUG, along with custom joinery, brass tapware and stone benchtops, are standard inclusions across all residences.&nbsp;

[smartcode_project:default project_id=9177 project_image_fid=350650]

<a href="https://www.apartments.com.au/new-apartments/crest-camberwell-936-938-toorak-road-camberwell-vic-3146">Crest</a> incorporates landscape design by <a href="https://www.apartments.com.au/landscape-architect/john-patrick-landscape-architects">John Patrick</a>, with a focus on low-maintenance planting and visual cohesion between the building and surrounding environment.&nbsp;

At ground level, greenery softens the building’s street presence and enhances resident privacy.

The development has been designed with energy efficiency in mind, achieving a 7-star rating. Features include double glazing, solar passive design principles, and materials selected for thermal performance and durability.

Farey &amp; Co is marketing Crest Camberwell. They are fielding enquiry from local downsizers predominantly, those who are looking for a well-located apartment in a small block with few neighbours.

[smartcode_project_cta:default project_id=9177]

Crest Camberwell fills low-density gap in prestigious suburb

Beller Commercial

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Today we chat to an Apartments.com.au favourite in Beller's Fred Nucara. Fred discusses current commercial leasing trends, the 'MKR Effect', the impact UberEats and the like are having on food and beverage tenants, and how development can contribute to vacancies in the short term on high streets like Chapel Street.

Finally Fred gazes into his crystal ball to provide a forecast for the Melbourne market in 2019.

<iframe allow="autoplay" frameborder="no" height="166" scrolling="no" src="https://w.soundcloud.com/player/?url=https%3A//api.soundcloud.com/tracks/536078538&amp;color=%23ff5500&amp;auto_play=true&amp;hide_related=false&amp;show_comments=true&amp;show_user=true&amp;show_reposts=false&amp;show_teaser=true" width="100%"></iframe>
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Laurence Dragomir

Weekly Podcast - Episode 41: Beller's Fred Nucara talks commercial leasing

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A host of planned ‘new arrival’ developments in Chapel Street will help to revive the retail strip, according to Director of Beller Commercial, Fred Nucara.

Every year, Beller Commercial conducts retail strip research: a manual foot walk and count of shop vacancies. From this unique research, Beller has a clear view on the changing fortunes of Melbourne’s various “high streets”.

Chapel Street is divided into three precincts: South Yarra, Prahran and Windsor. Whilst Windsor is now a pumping food and hospitality destination, Prahran and South Yarra sadly present a different story with a record number of vacancies, 17 in South Yarra and 24 in Prahran.

Fred took time out of his schedule to have a chat with me via phone as we discussed some of the factors that are currently impacting the strip now and into the future. 

<blockquote>
Chapel Street is at the bottom of a bell curve at the moment. These major developments within the precinct are detracting from the usual vibrancy, because of the inconvenience, noise and distraction of the construction.

On a positive note, these major infrastructure investments are scheduled for completion in 2019 and 2020.

- Fred Nucara
</blockquote>

For more, listen below:

<iframe allow="autoplay" frameborder="no" height="300" scrolling="no" src="https://w.soundcloud.com/player/?url=https%3A//api.soundcloud.com/tracks/445161288&amp;color=%23ff5500&amp;auto_play=false&amp;hide_related=false&amp;show_comments=true&amp;show_user=true&amp;show_reposts=false&amp;show_teaser=true&amp;visual=true" width="100%"></iframe>
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Chapel Street Podcast: On the phone with Beller Commercial's Fred Nucara 

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Melbourne's iconic shopping and dinning precinct of Chapel Street's fortunes have fluctuated many a time.
And now is the time to buy, according to Beller Commercial director Fred Nucara.
Chapel Street (South Yarra, Prahran and Windsor) has a pipeline of development projects worth more $150 million, including hotels, schools and new civic amenities.
From an established, retail strip that traverses from high-end designer labels and international anchor tenants, to the slightly raffish retail strip of Windsor, where a new hip neighbourhood has emerged, there are currently 45 vacancies on Chapel Street.
"Now is the time to buy, buying during counter cycles when an area is perceived to be suffering often sees huge financial reward long term,” said Nucara.
Corelogic also noted earlier this year that Chapel Street commercial property sales increased in the three months to February.
The property data firm said that sales recorded in the quarter ending February 2017 totalled $26.6 million from nine sales, compared with $3 million from three sales in the three months to November 2016.
The popular Café Sienna on the corner of <a href="https://urban.melbourne/projects/stonnington/402-416-chapel-street-south-yarra" target="_blank">402 Chapel Street</a> above ( image courtesy Plus Architecture) is being redeveloped by Spotlight Property Group and will feature a mixed-use development of 87 apartments and a proposed 4.5-star Aloft hotel run by the Starwood group with 174 hotel rooms.
Further down and at 303 Chapel Street, behind Coles supermarket, The Cato Square Project is one of the largest and most ambitious construction projects ever delivered in the City of Stonnington.
The vast expanse of The Cato Street carpark that flanks two supermarkets will be undergoing a makeover to a new public meeting place called ‘Cato Square’.
This $60+ million transformation will become almost 10,000 sqm of multifunctional urban parkland with underground car parking tucked out of site.
When completed in 2019, Cato Square will provide urgently needed open space for passive recreation, events, festivals and markets.
Some 200 metres west of Chapel Street, a high school is under construction.
“The $25 million Prahran High School will have the capacity to enrol up to 650 students and will become a major educational destination for the area and added boon for the Stonnington community.
With the spate of infrastructure projects, Nucara advises that investors should not be too worried about present rents but consider the future land value.
“Too often buyers are influenced by short-term factors such as high vacancy rates, rather than adopting a long-term view for commercial property in designated proven shopping strips.”
The underlying land value will not depreciate, however, sometimes purchasers need to accept an investment return of 3-5% in the meantime, he added.
"History has proven that what you pay today, even if it is within a precinct with high vacancy rates at that time, has shown to be relatively cheap, as tomorrow is a different ball game” says Fred.
Recently, a tenanted commercial building at <a href="https://www.realcommercial.com.au/property-offices-vic-prahran-502364494" target="_blank">228-230 Chapel Street, Prahran</a> went under the hammer on May 18. It was sold for an undisclosed sum. Previously, the property traded for $1.7 million, according to Corelogic RP Data.
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j.ballantyne1990-6AQqhLzZaK

Now is the time to buy on Chapel Street: Beller Commercial's Fred Nucara

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<a href="http://www.bellergroup.com.au/">Beller Commercial</a> has just completed their first quarter shopping strip research for 2016 - a matrix of 28 key shopping strips that depict the number of shops, number of vacancies, average asking rent per square metre and yield. Beller Commercial Agents take to the streets quarterly and physically count the ‘for lease’ signs, vacant stores, check the web listings and do the arithmetic themselves. Apartments.com.au recently caught up with Beller Commercial director Fred Nucara, to discuss the research and the impact of residential development on these strips. Last year's corresponding article <a href="/news/bellers-2015-commercial-retail-research-results-are-in">is also available</a>.

According to Nucara, some of the traditional strips such as Bridge Road that have previously had a high degree of vacancy at around 40% at one point have begun to drop down significantly to around 20-25%. On the other hand Swan Street to the south is performing 'solidly,' underpinned by the former Dimmeys store redevelopment and incorporated Coles supermarket and apartments, in addition to the injection of new residents along the strip. Swan Street between Church and Punt Road is "a hive of activity" with a completely different vibrancy to the corresponding area along Bridge Road says Nucara. The vacancy along Swan Street is currently sitting at 5% following an uptake of 3 tenancies. 

The strips which have seen the biggest change in vacancy, in terms of tenancy uptake between April 2015 and December 2015 include High Street Prahran and Armadale which have had 17 vacancies taken up in a very short period. Nucara believes this is a result of the affordability factor where a lot owners of properties which were vacant in April 2015 have come to the realisation that it's better having a tenant in on a lower rent than no tenant at all. $55,000 - $75,000 per annum, says Nucara is generally considered affordable to most businesses and even start-ups. Beller have also observed this trend in places like Glenferrie Road Malvern, for example which has seen 12 shops leased in six months or around two a month, a solid success rate says Nucara and largely a result of affordability and the rejuvenation of Malvern Central Shopping Centre.

In terms of uptake there has been a real shift towards health and wellbeing in addition to the more traditional food and hospitality tenancies. According to Nucara this has been occurring within precincts that are within 5km of the Melbourne CBD and are seeing 4-5 level apartment developments go up along their main strips as residents are demanding more than just a wine bar or cafe at street level. This health and wellbeing sector is comprised of anything from physiotherapy to beauty salons to gym and yoga studios which the current apartment market projects are seeing more and more. 

<blockquote>
The health and wellbeing category is significant and we are receiving regular enquiry from massage therapists, nail technicians, hairdressers and general fitness operators. It is clearly no longer a case of lets build an apartment building and put a café on the street level, new neighbourhoods require services too.
<cite>Fred Nucara</cite>
</blockquote>

On the impact of residential developments such as Smith and Co. in Smith Street on the strip, Nucara says that the opening of the Coles along with new apartments has created further activity within the precinct. Vacancy along Smith Street has always been fairly consistent with around 10-12 properties vacant over a 2 year period having seen 15 vacancies in December 2013, and currently sitting at around 12  along what is considered to be a long strip of 253 shops. Nucara predicts that as the Coles development cements itself within the area and further residential developments are completed in neighbouring streets,that these vacancies will being to be taken up relatively quickly. The sight of cranes and construction activity provides businesses with the confidence to establish themselves in the area with the knowledge that the residential population will grow. 

The big surprise from Beller Commercials point of view says Nucara has been Toorak Road, South Yarra, which is "where Smith Street should be" in the coming years. The issue that Toorak Road traditionally had was that there were a number of major sites that never got off the ground but now are - the cranes are there and construction is underway. What this means for vacancies is that businesses revisit the strip with the knowledge and confidence that a significant number of residents will be moving into the area providing the street with continuity and good flow from a retail perspective as the shops are leased. A result of this is as the vacancy rates drop, rents begin to go up as competition for tenancies heats up. The strip saw 7 properties leased in 6 months, a big shift in a small time frame and traditionally Toorak Road has seen 10-12 vacancies with only 5 currently, all driven by the influx of apartment stock. 

An emerging trend is that shopping strips further out of the traditional 5km CBD radius are performing very well. These satellite villages are servicing well-established, affluent pockets demographic pockets. Also adding to the popularity of these strips are new medium, 4 – 5-storey apartment developments which are more prevalent in suburbs such as Glenferrie Road, Malvern, Whitehorse Road, Balwyn and Burwood Road, Hawthorn. Whitehorse Road currently only has one vacancy, making it the second best performing retail strip within Beller Commercials research area. As further development occurs in these areas and vacancies are taken up, rents will also be driven upwards. 

One strip that has struggled has been Fitzroy Street St Kilda with a 24% vacancy rate and which has struggled to shake off what might be considered a 'shady identity.' Nucara believes Fitzroy Street should have more appeal because it close to the beach and has a similar feel to Smith Street, Collingwood a few years ago.

<blockquote>
I like to think the future prospects are good (new apartment buildings arriving and the infamous Gatwick Hotel currently for sale). Given the length of the strip, it needs to be better facilitated by car parking. Also there are nearby competing areas, where the street vibe is more pleasant such as Albert Park, Middle Park and Acland Street.
<cite>Fred Nucara</cite>
</blockquote>

<h2>Beller Commercial’s top ten performing retail strips</h2>

<ol>
<li>Acland Street, St Kilda</li>
	<li>Whitehorse Road, Balwyn</li>
	<li>Toorak Road, South Yarra</li>
	<li>Centre Road, Bentleigh</li>
	<li>Glenferrie Road, Malvern</li>
	<li>Burwood Road, Hawthorn</li>
	<li>Carlisle Street, Balaclava</li>
	<li>Chapel Street, Windsor</li>
	<li>Toorak Village, Toorak</li>
	<li>Smith Street, Collingwood</li>
</ol>
Performance and ranking is based on a ‘consistency’ of low vacancy rates, rentals at maximum levels and diversity of retailers/services over multiple research walks.
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Discussing the Beller Commercial 2016 Shopping Strip Research with Fred Nucara

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Beller Commercial recently completed their annual Commercial Retail Research, a matrix of Melbourne’s notable shopping strips which judges their performance over the last year. A unique initiative spearheaded by Beller Commercial Director, Fred Nucara, the Commercial Retail Research report is a detailed run down of the fluctuating fortunes of Melbourne’s famously fickle retail high streets and their performance.

The information in the report is gathered by the Beller team, hitting the streets and literally pounding the pavement in order to converse with retail tenants. Apartments.com.au spoke to Fred Nucara about Beller's research process, the findings of the report and any trends that they have emerged during the period of the research.

Laurence Dragomir: Can you tell us a bit more about the report and the level of research your team undertakes to develop the report and why you do it?

Fred Nucara: Basically what happens is that my team will walk all the shopping strips on this matrix. There's a cross reference process in place; they verify what's available online such as properties for 'For Lease' and match that up with what can be see - are there boards or banners on properties? Are the properties vacant? Are they closing down and so on.

It's time and labour intensive but the results speak for themselves compared to some of the research that has come out from the major agencies in the city which is very much desktop. Not only do the teams want to educate themselves about what's happening on their strip, but we wanted to get a snapshot so that when we are talking to a potential client, if we have a property for lease or for sale we are able to give them real time information about what's going on on that particular strip. There's nothing like first hand knowledge.

We can give examples where say 9 months ago there were 15 vacancies and now there's 20 or now there's 10, and that tells us something. For both our clients interest and our own, it pays to get out there and provide the most up to date information possible.

LD: Each time you do research is it always the same set of shopping strips?

FN: It's the same list of streets that we visit and we don't deviate off that list. I think there's about 23-24 visited each survey and we break it up as there's always markets within markets. A prime example of this is Chapel Street, broken down over it's Windsor, Prahran and South Yarra sections.

LD: Was there anything in particular that surprised you or stood out since you last conducted the research?

FN: The latest round of research was done in April 2015 and before that it was last done during September last year. The big surprise has been that in Chapel Street, South Yarra there has been seven properties let.

In September of last year there were 27 vacancies and as a result there's now only 20, and while it's still an elevated vacancy rate there are signs of recovery. A quarter of the properties taken up in seven months is quite a result.

Another notable result is Swan Street in Richmond, falling from 20 vacancies in September down to 12, which again if you look at that ratio equates to a 40% drop in vacancies. That is actually a pretty decent success rate over a six to seven month period.

If you had to look at the three big results, Bay Street and Church Street in Brighton also fared well. We look at Bay and Church as combined strips in Brighton, so along with the Swan and Chapel strips they make up the three big performers or best improvers over the period. Whitehorse Road, Balwyn was probably another one that jumped out at us, moving from 11 vacancies down to just three.

LD: What do you put that improvement in the space of seven months down to?

FN: There are what we call some general overarching economic reasons as to why this increased level of activity has taken place. In this environment where business funding is pretty low, the confidence exists to borrow as a small business because funding is very cheap.

Alternatively some of these tenants and businesses are acting as owner-occupiers and buying the properties. What that does is it removes them from the tenancy market altogether because they want to become the owner of their freehold and run their business. The other thing too that happens is that landlords' expectations on rent begin to align more with what is considered a feasible proposition for a lot of small businesses.

What I mean by that is if you look at most of these strips, most of the rents will fall between $50,000-80,000 per annum, so there's this band where some rents begin to adjust and landlords begin to treat and transact, in other words the landlord that wants to get $90,000 p.a but is happy to keep cash flow at $80,000.

Even with all the evidence we've got which is shown to the landlord upfront, on occasion they may not accept the figures before them. They may believe their shop is worth $100,000 p.a but we think we're going to get around $70,000 and so often they need time in the market to experience that, and with our research and direct contact with offers from tenants then they begin to align their expectations.

LD: I suppose the one thing that really interests us here at Apartments.com.au is the impact of gentrification and new developments on these strips.

FN: That's a huge impact but it's more of a psychological impact, Laurence and I'll tell you what I mean by that. For example, if you have an area that has a lot of permits approved for apartment developments it is mooted that that area could become a really positive area in the future. But that doesn't necessarily mean it's an impetus for tenants to pick-up vacant space so what we tend to find is the impetus is actually when they start to see cranes and the construction coming out of the ground.

Good examples of this are areas like Collingwood, Fitzroy and Prahran. Cranes equal an increased local population and as a result of that it provides confidence to sign leases. What they're banking on is that they'll be able to attract the new residents across their front door; it creates this wave of activity that's much stronger in areas where they know there are cranes, properties and tenants ready to move in or residents ready to move in.

LD: On that basis do you think that Chapel Street, South Yarra has struggled somewhat because most of the new apartment development has been concentrated within the Forrest Hill precinct and further north along Chapel?

FN: Chapel Street, South Yarra has probably struggled for two reasons. I think one is definitely the concentration around Forest Hill and that has perhaps sapped a bit of the life out of Chapel Street to a degree, but Chapel Street has always commanded premium rents. What's happened there is because it's such a long strip the rents have gotten to a level now where some of these national businesses can barely afford and be profitable, but they do it to have a presence on Chapel Street.

So what you're probably seeing is it's suffered from the rents being traditionally high and it's hard to sustain those rates per sqm in those locations, particularly when you've got Emporium or an expanded Chadstone sucking a portion of the customer base away from Chapel Street, South Yarra. That means less customers through South Yarra, which is quite different to Chapel Street, Windsor by the way - very, very different demographics - so the customers are going and spending there money elsewhere, consequently placing pressure on businesses to pay their rental rate.

LD: Thank you for your time Fred.
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Beller's 2015 Commercial Retail Research results are in

<html><body>
As one of Melbourne's largest independent real estate agencies with over 50 years experience, Beller Group has a fundamental understanding of the current Melbourne apartment market and the nuances which influence it. By way of establishing Beller China and forging an alliance with Beijing-based property agency giant Sagacity, Beller Group have gained an intimate, market-leading understanding of the factors behind the unprecedented rush of Chinese property buyers into the Melbourne market in recent years.

Days after arriving back from a Chinese sojourn, Apartments.com.au sat down with Beller Group Director Andrew Fawell to learn his thoughts relating the wave of Chinese investors seeking their slice of the Melbourne market.

<h2>The Chinese perspective</h2>

To understand the Chinese property buyers attitude toward Melbourne at the moment requires a basic understanding of Chinese domestic affairs. Andrew believes the burgeoning middle class have never before had so many sources of information in order to make considered decisions, thus many Chinese nationals are now taking steps to secure their wealth and long term prosperity.

With the backdrop of China's economy slowing and a shifting political paradigm, middle class Chinese are investing overseas in record numbers - an exodus of wealth as a precursor to potentially leaving themselves. Property is considered a safer, secure method of parking wealth given the Chinese maintain a general aversion to shareholding.

Asked to further elaborate, Andrew stated that whether it materialises or not there is a growing perception amongst Chinese that their economy is susceptible to collapse, and as such those in a position to do so have sought out the safety of markets such as Melbourne in which to park their wealth. With Melbourne's solid fundamentals, excellent quality of life and strong political foundation, it's seen as a prime destination for Chinese.

Base upon first hand experience through Beller China, Andrew also emphasises the ostentatious nature of middle class Chinese who delve into offshore property purchases. A strong number of buyers into markets such as Melbourne are not particularly bothered about a given property's value or it's ongoing capital gain, but rather they want to be seen to be doing something.

This in part has given rise to the "Fly to buy" element of the market as they have been christened. Somewhat incredulously Andrew reeled off numerous instances where Chinese nationals have flown into Melbourne for the sole purpose of purchasing single/multiple apartments, only to leave immediately thereafter.

<h2>The importance of relationships in China</h2>

<blockquote>
We are delighted to announce the new partnership with Sagacity China. Not only will this facilitate introductions to new markets in China, but also importantly, we will be able to facilitate deals with major Chinese developers to buy development sites in Melbourne. Like any good relationship, it will be a two way conversation and one of mutual benefit.
<cite>Andrew Fawell</cite>
</blockquote>

Official PR statements aside, Andrew believes the key to the above comment is the penetration of new Chinese markets. Evidently the current crop of buyers reside in primary or first tier Chinese cities such as Shanghai oe Beijing. As buyer experience and information flow heightens, the buyers sophistication naturally increases.

To that end Beller Group are of the opinion that should the initial wave of first tier Chinese buyers double dip into the Melbourne property market, they will most likely avoid the masses of apartments on offer in Melbourne's CBD next time around and exercise a level of knowledge by purchasing in smaller developments beyond the CBD.

Paraphrasing Andrew Fawell, the initial wave of buyers content to buy into large developments within Melbourne's CBD will dissipate, in turn replaced by a new wave of Chinese buyers from second tier cities who are just now delving into offshore property purchases without the same benefit of hindsight as the initial tranche. Put into perspective those second tier cities such as Tianjin, Chengdu and Changsa and Qindao have metropolitan populations averaging over 10 million which enforces the theory that Chinese investment into Melbourne property and principally apartments will only balloon further.

<h2>The Melbourne perspective</h2>

The vexed question of the current state of the Melbourne property market has been a hot topic in recent weeks. Andrew Fawell considers the Chinese influence on the local apartment market a game changer where fundamentals have been altered, effectively covering some of the market deficiencies that have arisen in recent times.

At this point Melbourne has moved into the top handful of cities preferred by Chinese property investors, usurping Vancouver whose market was stymied by Government intervention. Asked of the prospect of Government responding with similar measures here Andrew suggested that if the current situation is allowed to run unchecked, the specter of such a move would increase.

Andrew Fawell also raised the notion of a two-paced local property market with pitfalls for the unsuspecting investor, whether they be local or international. Certainly in some areas of Melbourne there remains strong buyer and rental demand for smaller, well positioned, higher quality apartment projects, whilst a looming glut of rental stock in and around the CBD may cause havoc even though the demand to buy particularly from offshore parties will remain robust.

Interesting times ahead!
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