STRONG Hongkong investor interest is expected in a A$35 million (HK$189 million) commercial and retail property auction in Melbourne, Australia, next month. The 13 prime properties, which include a north suburban shopping mall, are being sold by Baillieu Knight Frank (BKF). The Australian and New Zealand Bank is the mortgagee in possession of about half, and will offer finance of up to 80 per cent of the selling price to approved buyers, including overseas investors on all the properties. BKF director Mr Colin Calder told the South China Morning Post the auction was believed to be the biggest involving such valuable quality stock yet held in Australia. It is being publicised throughout Asia, and a BKF director will visit Hongkong and Singapore next week to speak to individual investors about the properties, in particular the shopping mall. ''Hongkong investor interest is strong and we are finding this increasing, not only for the traditional central business district property, but also a wider area,'' said Mr Calder. ''Hongkong investors are seeing Melbourne as being good real estate value. ''We are on a bottom, and the only way is up from here.'' He said Hongkong investors would focus on the Milleara Mall in East Keilor, which comprises a supermarket and 34 specialty shops on 3.18 hectares. Its net income is A$1.43 million a year and it is expected to fetch between A$10.5 million and A$11.5 million. He said investors from Hongkong would also be attracted by a new office building in east suburban Mulgrave, which is leased for 10 years at a net income of A$435.7 a year to the Gas and Fuel Corp. It is expected to fetch between A$3 million and A$3.5 million. An eight-level office block in inner city St Kilda Road is returning A$246,000 a year and is expected to fetch between A$2 million and A$2.5 million. Mr Calder said it was also likely that a Hongkong investor would buy the Cafe K, a three-storey Chinese restaurant in Crossley Lane, in the heart of Melbourne's Chinatown. It is presently on a monthly lease. BKF is expecting a high clearance rate - perhaps even 100 per cent - and the auction is seen as an important barometer of the Melbourne market.