Williamstown’s shipyard hits the slipway with a price tag of $200m

Williamstown’s shipyard, the last of its kind in Victoria, is for sale eight years after the last vessel plunged down the slipway and ship-building ceased at the 16.81-hectare site.

The vacant yard with gantries, workshops and warehouses at 2-10 Nelson Place has a price tag that could hit $200 million.

Better days: a Navy ship in the Williamstown shipyards in 2015.Credit: Paul Jeffers

Set between the Williamstown Marina and the Mobil refinery’s fuel tanks, it is just three kilometres from the Port of Melbourne, the country’s biggest container port.

Williamstown, a seaside village in Melbourne’s west with a historic waterfront and city views, is a highly desirable residential location. AV Jennings has built apartments across the road from the shipyard, but the site is likely to remain industrial for the foreseeable future.

British military hardware and technology giant BAE Systems has owned the yard since 2008, after it bought Sydney-based infrastructure company Tenix for $775 million.

The entire shipyard could fetch as much as $200 million depending on the configuration of the sale. The site, comprising three pieces of land, is being offered to buyers with two options.

The first option – a 9.9-hectare lot with two jetties and a host of buildings, and a 1.9-hectare car park on Battery Road – could sell for between $80 million and $100 million.

However, if the deal includes an adjoining 5-hectare parcel with 10 workshops and offices, it could reach that $200 million price point.

BAE Systems is considering either leasing or retaining the 5-hectare freehold. The company did not respond to a request for comment.

The Williamstown shipyard dates back to the 19th century and includes the heritage-listed Alfred Graving Dock built by Victoria’s government between 1864 and 1873 at a cost of more than £300,000. The dock, which enabled ship repairs, was the biggest infrastructure project undertaken by the government at the time and was of international importance, according to local and naval history sources.

The site was also the original location of the Victorian Navy, which predated the Federation in 1901. Shipbuilding started in 1913 and was taken over by the Commonwealth during World War 1.

Known as HM Naval Dockyard, it remained under the control of the Federal government until Transfield – later known as Tenix – acquired the site in 1987.

Victoria’s historic role in the nation’s shipbuilding industry eroded over the last decade before finally ending in 2017 when the Turnbull government ploughed money into shipyards in Adelaide and Perth. Under the AUKUS program, any new submarines built in Australia will be built in Adelaide.

CBRE agents Chris O’Brien, Andrew Bell, Trent Hobart and Tom Hayes are handling the sale.

Portfolios sales

Two portfolio sales this month have reaped $27.5 million with 10 assets held in family hands for generations selling to new owners, five of them sourced through Stonebridge Property Group’s Asia Practice team.

The Levy family’s KFC at 379 Chapel Street sold at auction for $5.25 million on a 4.67 per cent yield after bidding from seven parties.

“The short 2.5-year lease to KFC, coupled with the building’s heritage significance resulted in a level of market caution,” Stonebridge agent Nic Hage said.

379 Chapel Street, South Yarra.

A vacant workshop and warehouse at 10 Thompson Street, Abbotsford, close to the Carlton & United Brewery, fetched $2.8 million, and an office at 319 Queensberry Street in North Melbourne sold for $3.54 million.

The Pistorino family’s assets – including an office building at 221 Drummond Street, a shop on Lygon Street, and a shop on Puckle Street in Moonee Ponds – totalled $15.72 million.

Stonebridge agents Nic Hage, Rorey James, Chao Zhang, Julian White, Dylan Kilner and Max Warren did the deals, along with Adam Guest.

In other recent auctions, the T2 shop at 340 Brunswick Street, Fitzroy sold last week. Bidding from five parties got the price to $1.72 million and a 4.1 per cent yield.

Fitzroys agents Chris Kombi, Ervin Niyaz and Ben Liu ran the auction.

The neighbouring property at No.342 passed in and is listed for $2.1 million. Leased by the Blackout nightclub, it was once home to Rhumbarella’s, one of Brunswick Street’s early cafes.

Lanes

Capital Gain loves a historic laneway warehouse, and this week there are two adjoining properties for sale at 14-20 Goldie Place, which runs parallel to Queen Street and Hardware Lane.

The 495-square-metre brick warehouses are on a 269-square-metre piece of land and last changed hands in 2016 for $5.45 million. They come with a much-coveted 5am liquor licence, and most recently housed Jasper’s jazz bar.

The site was approved for a new 13-storey 34-unit apartment project in 2015, predating its inclusion in the Hardware Lane heritage precinct, but that never got off the ground.

No.18-20 is an Edwardian warehouse, while its neighbour dates to the interwar years. They’re located between Little Bourke and Lonsdale streets, behind Charter Hall’s 200 Queen Street.

Cushman & Wakefield agents Anthony Kirwan, Daniel Wolman, Oliver Hay and Leon Ma have the listing and are expecting around $10 million for the site.

Nearby, another Edwardian warehouse at 19-21 Niagara Lane is for sale at $4.55 million. The three-storey, 440-square-metre renovated property has been converted for residential use and boasts a rooftop terrace.

The property is on a 118-square-metre parcel of land, and is one of only five warehouses remaining on Niagara Lane. CBRE agents Alex Brierly, Nathan Mufale and JJ Heng are handling enquiries.

By the river

Down by the river, a two-storey office at 524 Flinders Street, on the corner of Katherine and Mercantile places, is on the market for the first time in 41 years.

The 635-square-metre building is on a 390-square-metre parcel of land a couple of doors away from Sandhill Road’s redevelopment of the Waterside Hotel.

Records show Aichi Investments paid $245,000 for the office in 1982.

Colliers agents Matt Stagg, Nick Garoni, Ted Dwyer and Yvonne Zhou are running expressions of interest and are expecting around $10 million.

524 Flinders Lane, Melbourne

Smell it?

Scent marketing group Air Aroma is setting up shop at Morris Moor in Moorabbin, taking a 451-square-metre space in the business park.

Air Aroma has signed a five-year lease with a five-year option at the former Philip Morris factory, and will also design a signature scent for the estate.

Founded 20 years ago, Air Aroma makes bespoke scents for a range of businesses, including Hotel X, RM Williams, Ritz Carlton, Hugo Boss, Cathay Pacific, Langham Hotel, Mont Blanc and Manning Cartell.

Air Aroma’s boss Alan Van Roemburg describes the scent-maker’s business as “crafting unique olfactive logos.”

While plenty of people have an aversion to the smell of cigarettes, perfumes with tobacco notes are popular.

Up Property bought the old Phillip Morris factory and warehouse in 2015 for $20 million after the tobacco giant shifted cigarette production to Korea.

There’s not much space left at the sprawling 6.3-hectare complex. About 2300 square metres of the remaining 3000 square metres is already under offer.

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