Strong investor demand for well leased assets and the pending expiry of a number of Primewest syndicates have sparked the sale plans, which will be guided by CBRE.
Primewest’s John Bond said the eight properties in New South Wales, Victoria, Queensland and Western Australia would be offered individually or in one line – providing an opportunity to secure a quality, national portfolio of significant scale.
He said both local and international institutions as well as large scale individual investors were always looking for high value, quality Australian assets that would either bolster or create a significant presence in the local market.
“There are strong economic fundamentals, good borrowing conditions, very little risk and diversity and this portfolio is well packaged to meet all those criteria.”
The portfolio consists of the following assets:
NSW: 207 Pacific Highway, St Leonards (50% interest) and 11 Argyle Street, Newcastle
VIC: 616 St Kilda Road, Melbourne
QLD: 1 Breakfast Creek, Brisbane; 99 Melbourne Street, South Brisbane and
108 Wickham Terrace, Fortitude Valley
WA: 53 Ord Street, West Perth and 619 Murray Street, West Perth
CBRE National Director, Capital Markets, Josh Cullen said the offering coincided with continued strong investor demand after a record 2014 during which over $12.2 billion in office assets had transacted nationally.
“An increasing proportion of these transactions have been for core plus/value add stock as investors shift up the risk curve to chase higher IRR’s and returns,” Mr Cullen said.
“There has also been significant demand for large scale acquisitions, with a number of these assets traded in portfolios, allowing groups to acquire large scale, value add opportunities.”
This was expected to underpin significant local and offshore investor demand for the Primewest portfolio, Mr Cullen said, with the falling AUD likely to further strengthen the level of foreign buyer demand for quality assets.
The portfolio predominantly consists of inner suburban office buildings in established commercial locations.
“With low interest rates, a relatively strong economy and a great diversity of property markets across the country, Australia is a very appealing destination f“There is value add potential throughout the portfolio with residential use identified as a possible alternative use for two of the assets – being 616 St Kilda Road, Melbourne and 11 Argyle Street in Newcastle,” Mr Cullen said.r international investment,” Mr Bond said.
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CBRE Group, Inc. (NYSE:CBG), a Fortune 500 and S&P 500 company headquartered in Los Angeles, is the world’s largest commercial real estate services and investment firm (in terms of 2014 revenue). The Company has more than 52,000 employees (excluding affiliates), and serves real estate owners, investors and occupiers through more than 370 offices (excluding affiliates) worldwide. CBRE offers strategic advice and execution for property sales and leasing; corporate services; property, facilities and project management; mortgage banking; appraisal and valuation; development services; investment management; and research and consulting. Please visit our website at www.cbre.com.
