Centuria secures Bowen Hills office block for $65m
Property funds group Centuria has snapped up an office block in Brisbane’s Bowen Hills for $65.4 million as it bolsters its unlisted diversified vehicle.
The group bought the building at 25 Montpelier Rd from the long-term owner GWC Property Group that had picked up the complex from The Public Trustee of Queensland for $37.82 million.
The purchase of the A-grade office near the Gasworks precinct by the Centuria Diversified Property fund was its third direct property acquisition this year and took its assets under management toward $200 million.
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The property is fully leased and has a six-year weighted average lease expiry. It has about 7000sqm of office space and 700sqm of ground floor retail.
Centuria joint chief executive Jason Huljich says the deal is in line with the group’s strategy to accelerate asset under management growth, and with the fund’s strategy to increase its balance of direct property exposure for investors on the heels of two acquisitions earlier this year – 381 Macarthur Ave, Northshore Hamilton, Queensland, for $19.7 million, and 10 Moore St, Canberra for $35 million.
“This is CDPF’s third direct acquisition. Brisbane markets are steadily improving with continuing yield compression and decreasing vacancy rates,” he says.
“The fund’s strategy is to buy properties that enhance the quality and diversity of its portfolio and contribute to strong distribution returns for its investors.”
Huljich says Centuria offers a range of A-REIT and unlisted property fund options for investors and that CDPF offers some of the benefits of both structures.
He tipped growth would ramp up in Brisbane in the next six to 12 months. “Vacancy rates are falling, net absorption is up, and this means that effective rental growth is very likely to follow, particularly as infrastructure projects currently in the works start to come online,” Huljich says.
Centuria last week snapped up an Edward St tower in Brisbane’s CBD for $89 million as it boosts the size of its unlisted property empire.
The company picked up the tower at 348 Edward St from US group Hines, which bought it in 2016 for about $50 million and then overhauled it.
The 15-storey office building was built in 1986 and refurbished in 2007. Centuria will now put it into a new fund.
This article originally appeared on www.theaustralian.com.au/property.
