A rare office island in Melbourne’s legal and financial heartland may have hit the market at just the right time as demand for CBD offices rebounds and rents climb.
Lendlease has transformed the tired 459 Little Collins Street building, turning its 15 storeys — spanning 1,053 sqm with four street frontages — into a modern gem.
Upgrades include flexible floorplates, a refreshed lobby, end-of-trip facilities (including two exclusive infrared saunas and access to wellness facilities) and spec suites.
The building also offers 13 basement car parks and ground-floor retail tenancies — all steps from charming laneways and Southern Cross, Flinders Street and Flagstaff stations.
Lendlease’s smart refurb of the once tired office tower means it could also be used as a hotel, college or medical facility. Picture: realcommercial.com.au
Agent Daniel Wolman at Cushman and Wakefield said the building is only about 20% leased with these leases expiring soon, which makes it perfect for adaptive reuse under its City Zone 1 (CCZ1) zoning, allowing offices, education, medical, accommodation or hospitality (STCA).
“It presents extremely well and suits an aggressive leasing campaign. As an island site, it’s ideal for a hotel or build‑to‑rent conversion,” he said.
“We’re seeing strong interest from both office investors as well as those looking at conversions.”
Demand for Melbourne offices growing
It’s certainly not a bad time to sell a premium office building in central Melbourne.
While the city recorded an office vacancy rate of 19% in January, up from 17.9% in July 2025 and the nation’s highest against an average of 15.9%, demand is also rising, according to new data from the Property Council of Australia .
REA Group senior economist Anne Flaherty pins this rising vacancy rate on fresh office supply.
“Demand to lease office space in Melbourne is growing. It’s just that on the flip side, the supply of new office space being delivered has been quite high, in particular over the last six months, which has created a higher vacancy.”
The building has attracted interest from both office investors and those seeking a conversion opportunity. Picture: realcommercial.com.au
In more good news for Lendlease, prime net face rents reached $755/sqm in Q3 2025, up 5.3% year-on-year, according to Knight Frank’s latest Melbourne CBD Office State of the Market report.
However, buyers remain cautious, especially given February’s interest rate rise and the potential for another in 2026, said Damian Lynch, associate director at Acumentis, though he added this subdued climate also created opportunity.
“Some prospective buyers are seeing the current moderate economic conditions as an opportunity to acquire high yielding assets in the CBD,” he said.
There are also local economic headwinds, namely Victoria’s high property taxes and the state government’s plan to mandate two working-from-home days per week for eligible roles.
The 15-storey building includes refreshed facilities throughout. Picture: realcommercial.com.au
Mr Lynch said the mandate would likely have an economic impact on businesses that rely on foot traffic.
“Falling revenues for businesses could put downward pressure on rents and increase incentives to attract prospective tenants.”
CBRE’s early 2025 data showed return-to-office rates averaging 75% of pre-COVID levels across Australian CBDs, with Melbourne’s at 61%.
Ms Flaherty said while we’re yet to see businesses significantly expand their footprint again post-pandemic, the number of businesses operating in Melbourne is on the rise.
459 Little Collins Street is close to all the city has to offer. Picture: realcommercial.com.au
“We have seen the creation of more new companies, which helps to support that growing demand for office space.”
459 Little Collins Street is offered for sale by expressions of interest, closing on Wednesday 11th March at 2pm.