Banana Group swoops on Argus Partners' iconic Surry Hills office building
Barana Group swoops on Argus Partners' iconic Surry Hills office building
| 21 September 2017
Barana Group has secured the landmark Reader’s Digest Building in Surry Hills for $52,673,000 amid strong ongoing growth in the inner-Sydney suburb.
CBRE’s Scott Gray-Spencer negotiated the off-market sale of the property, which was originally the home of Reader’s Digest when constructed in 1967.
Situated on a prominent island site, the 26-32 Waterloo Road building will soon be fully occupied by Woolworths’ subsidiary Endeavour Drinks Group on an eight-year lease.
Argus Property Partners acquired the property in 2014 for $30,000,000. The sale price reflects a sub 6% yield and generates strong returns for Argus’ investors.
“This is an astute purchase for Barana given the building’s location, strong tenancy profile and future potential,” Mr Gray-Spencer said.
“It also represents a great recycling of capital by Argus, who have added considerable value to the property by extending Endeavour Drinks Group’s lease over the entire building.”
The four-storey building has a total lettable area of 7,055sqm. The land area is 3,965 sqm, encompassing an entire block bounded by Cooper Street, Waterloo Street, Adelaide Street and Adelaide Place.
“There has been an increasing trend for renovation and residential conversions in Surry Hills over the past decade, with the market having also benefitted from tremendous growth in office rents over the past three years,” Mr Gray-Spencer said.
“The property represents one of the only large floor plate buildings in the city fringe. This, coupled with the property’s character feel and its location close to the new light rail station on Devonshire Street, should mean that the trend in office rent growth for this property will continue.”
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