Southbank tower provides latest investment opportunity for Marquette Properties

Real estate investment manager Marquette Properties has acquired a prominent office building in Brisbane’s Southbank for $104.4 million as it continues to expand its syndication business.

CBRE’s Tom Phipps negotiated the off-market acquisition of the 189 Grey Street office tower from Mirvac as the group continues its divestment strategy to fund recent acquisitions and its development pipeline.

Developed by Mirvac in 2005, 189 Grey Street is one of only seven office buildings in Southbank – Brisbane’s most tightly held office market.

Marquette Managing Director Toby Lewis said, “We are grateful for the opportunity to buy this asset and be custodians of a Mirvac designed, developed and managed building with enduring value and quality. By measure of office fundamentals, the asset is one of the best buildings in Brisbane. Moreover, we’d argue that Grey Street is among the top three streets in Brisbane for office buildings, offering amenity which is among the best in our city.”

Mr Lewis noted that Southbank had a minimal office vacancy rate, entailing just 1 ½ floors at 189 Grey which were expected to be leased in the short term.

In relation to Marquette’s broader market outlook, Mr Lewis said, “We remain cautious but acquisitive and feel that the significant volatility across markets augers well for commercial property. We will keep our assumptions around interest rates and cap rates conservative but feel next year will be a big bounce back for our industry.”

189 Grey Street is a 12-level, A grade office complex comprising 12,595sqm of net lettable area and 146 car parks. 

Situated within 200 metres of bus, rail, ferry stops and the future Brisbane Metro line, the asset is 60% leased to multinational insurance company IAG and engineering, procurement, construction management, and operations service provider Ausenco. 

CBRE’s Mr Phipps noted, “With very little REIT, wholesale or offshore direct capital currently active we are seeing syndicators, club investors and privates taking advantage of the current market volatility to secure quality assets that larger institutions deem too small or non-core. We had made several approaches to acquire 189 Grey Street on Marquette’s behalf and were ready to act when Mirvac elected to sell.”