Primewest buys up WA shopping centre and office tower
The John Bond-led Primewest has snapped up an office block and a shopping centre in Western Australia in deals worth $65m in total as it buys fresh assets that will add to its $4 billion property funds empire.
The funds manager, that listed in December, plans to explore the potential to develop residential buildings on the sites it picked up, flagging an expansion of its exposure to apartments.
Primewest is already in a joint venture with Iris Residential in Perth for a mixed-use project with 153 apartments above a neighbourhood centre.
“That’s our first exposure to residential … as we go on we will do more of it,” Primewest executive chairman Bond says.
“We’ve got a number of shopping centres that are amenable to residential development,” he said. “We will be working through those and seeing what value we can unlock as we go.”
Bond says that if they are on Primewest sites, the company will think about undertaking the projects, but this will be handled on a deal-by-deal basis.
The moves indicate the bullish views of commercial property investors who see the potential for apartments on their sites as the residential cycle picks up.
The company’s development track record includes a series of office blocks along the eastern seaboard as well as in its home city of Perth.
Primewest says it has bought the office building at 66 Kings Park Rd in West Perth and a Woolworths-anchored shopping centre in Mandurah, south of Perth.
The Primewest 66 Kings Park Road Trust paid $33.1 million for the offices and $32 million for the Mandurah Greenfields Shopping Centre.
The A-grade office building underwent a major $6.5 million refurbishment and is fully leased with tenants including Zurich, Konica Minolta, Minjar Gold, Redwood Wealth Alliance and cafe, Donnie Taco.
Primewest directors John Bond, David Schwartz and Jim Litis. Picture: Supplied
The Primewest Diversified Income Trust No 4 purchased the shopping complex that is now anchored by a Woolworths supermarket and BWS liquor store with strong annual sales growth over the past 12 months at 3.3% per annum.
The centre was built three years ago and sits in an expanding residential catchment area with population growth of 1.7% per annum expected over the next 10 years and projected retail spending growth rate of 4.3% per annum.
The Mandurah shopping centre allows for medium-density residential development and could yield up to 950 new dwellings in the catchment area.
The Kings Park Rd office had a total land area of 3168sqm and has future redevelopment potential of about 1,970sqm of residential accommodation, with a spectacular Kings Park outlook.
“Both of these assets are consistent with Primewest’s objectives of counter-cyclical investing and identifying strong, value-add opportunities,” Bond says.
Primewest manages more than $4 billion worth of property funds and has assets in all mainland states of Australia and the west coast of the United States.
Since setting up in 1995, the company has undertaken value-add and counter-cyclical property strategies and has snapped up assets right across the retail, industrial, commercial, residential and large format retail property sectors.
This article originally appeared on www.theaustralian.com.au/property.
