Hong Kong investors ramp up Sydney office grab
Hong Kong investor Longbow Holdings has finalised its purchase of a building in Sydney’s Kent Street occupied by the Central Queensland University for $111.8 million.
The group’s acquisition of the A-grade tower from Credit Suisse Asset Management was flagged by The Australian and continues the run of sales to Asian groups in the city.
The 11-storey tower at 400 Kent St sits in the western corridor.
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Credit Suisse’s asset arm picked it up for $58 million from two Charter Hall funds in 2014.
It drew strong interest, as it is fully leased to the university with a 14½-year weighted average lease expiry, which appealed to international groups.
The property was sold to Longbow on a sub-4.5% yield after the asset received strong interest from both domestic and offshore investors.
Beyond Asia, we continue to see international capital targeting Australian assets. European investors remain active in the market, with more deals set to be announced this year
Cushman & Wakefield’s Mark Hansen and Richard Butler brokered the sale. They say that strong demand from investors reflects the limited availability of quality office stock in the area.
The tower has 10,041sqm of office accommodation, with 420sqm ground floor retail space and access to 10 basement car spaces. It was refurbished in 2005 and more recently the plant and machinery were upgraded.
“We continue to see interest in Sydney CBD office assets from a broad spectrum of global investors, especially those based in Hong Kong and Macau who are extremely active in the Sydney market and pursuing investments interstate,” Hansen says.
“In addition, we are currently seeing a renewed interest from Singaporean investors targeting investment assets to diversify their income streams.”
Asian investment volumes in this quarter have been led by M&G Asia Fund’s purchase of a half-stake in Mirvac’s 80 Ann St project in Brisbane for $418 million and Japanese investment into Daibiru’s purchase of Sydney’s 275 George St for $240 million.
Hong Kong’s KHI Holdings also acquired 277 William Street, Melbourne, from EG for $93.9 million.
“Beyond Asia, we continue to see international capital targeting Australian assets. European investors remain active in the market, with more deals set to be announced this year,” Butler says.
This article originally appeared on www.theaustralian.com.au/property.
