Former Cadbury building finds sweet spot with AMP fund

AMP Capital’s Wholesale Australian Property Fund is in due diligence to buy the Cadbury-Schweppes House office building on Melbourne’s St Kilda Rd for about $90 million.

The 19-storey building at 636 St Kilda Rd was part of a $300m portfolio private equity giant Blackstone bought in 2013 from GE Capital.

The deal, being struck on a yield of about 7%, is being brokered by Colliers International’s Leigh Melbourne, Nick Rathgeber and Trent Hobart, who could not be reached for comment.

AMP and Blackstone declined to comment.

The building has more than 17,000sqm of space on a 4500sqm site and has future development potential.

Cadbury-Schweppes House has undergone significant refurbishment

If the deal is finalised it would be the second acquisition by AMP’s WAPF in the second half of the year.

The group in September paid $39 million for a 10-level office building at 425 Collins St in a deal handled by CBRE.

That building is 89% occupied, with a weighted average lease expiry of 2.8 years.

The fund was established in 1985 and has 15 properties with a total value of about $800 million.

The Blackstone sale comes as it is closing in on the $680 million purchase of the Southern Cross Towers in Melbourne being sold by Brookfield Property Partners.

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