$90m to $270m: Sydney office value triples in four years

Swire House at 10 Spring St changed hands for $270.05 million. Centuria Property Funds bought the asset for $91.64 million in 2013. The deal was flagged in The Australian this week.

Lendlease says the block still has short-term income growth opportunities after the Australian Prime Property Fund Commercial — managed by Lendlease Investment Management — swooped on the tower.

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“This is a strategic acquisition for APPF Commercial as it continues to focus on investing in next-generation, sustainable precincts in transport-rich locations,” Lendlease Investment Management managing director Josh McHutchison says.

“Other examples in line with this strategy include our investments in One Melbourne Quarter in Melbourne, and in Sydney, Darling Square and the International Towers at Barangaroo, all of which are world-class precincts well-positioned for success.”

Lendlease has extended its grip over a key block in the Sydney CBD and the property could form the basis of the CBD’s next supersite, as Lendlease completes its Barangaroo South precinct and stocks up on sites for the city’s next cycle.

Agents on the deal were INC RE’s Josh Cullen and Rick Butler and Savills’ Simon Fenn, Graeme Russell and Ben Azar.

Centuria’s chief executive of unlisted property funds Jason Huljich says the tower had a strong passing net income and fixed annual rental increases of around 4%. “The weighted average lease expiry is relatively short at about three years, offering the chance to capitalise on demand for B-grade office space in the Sydney CBD when leases come up for renewal,” he said.

“The site is large (1505sqm), has dual street frontages, and will benefit from new infrastructure and transport now being built.’’

This article originally appeared on www.theaustralian.com.au/property.