Abacus counts Brisbane tower as latest buy
Abacus Property Group and its backer South African-listed Investec Australia Property Fund have sealed their purchase of a $132 million office tower in Brisbane’s CBD from Brookfield and Dexus Property Group.
Abacus, led by Frank Wolf, has assembled a strong group of institutional backers, and winning the support of Investec on the deal could drive further opportunities.
The move by Abacus on the tower at 324 Queen St in Brisbane’s CBD, sold by Canadian giant Brookfield and the unlisted Dexus Wholesale Property Fund, was flagged by The Australian last month.
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The deal was brokered by Knight Frank’s Justin Bond and Ben McGrath and JLL’s Seb Turnbull, Geoff McIntyre and Luke Billiau.
Brookfield is looking to fund projects includng a $1.7 billion office and retail development at Wynyard Place, which National Australia Bank is seeking to tie up as its new Sydney headquarters.
Dexus says selling the 19,895sqm B-grade building, built in 1975 and refurbished in 2001, will help fund the trust’s development pipeline. Fund manager Michael Sheffield says the sale is “at the right point in the cycle”.
The building is about 80% leased.
Abacus and the Investec fund bought the tower, which sits in a premier position in the Brisbane CBD’s Golden Triangle, as tenants in common in equal shares. The complex, which comprises a main tower of 22 levels, a three-level podium, two-storey basement carpark and ground level retail, is about 80% occupied and has a lease expiry profile of 3.2 years.
Dr Wolf says he is pleased to create a new investment partnership with Investec.
“The asset offers excellent fundamentals in a prime location with exciting opportunities in a complex office market. We and our co-owner see real potential to drive returns through strong leasing and tenanting strategies,” he says. The partnership will buy the property on a 12-month forward yield of 7.2%. Once it is fully leased the yield could rise to about 8.9%.
Investec fund chief executive Graeme Katz says the purchase is the vehicle’s third acquisition of an asset carrying some vacancies, and the practice has been successful.
Katz notes the price equated to $6642 per square metre, below deals on nearby buildings that had been struck at $7700-$9700 per square metre.
This article originally appeared on www.theaustralian.com.au/property.
