Property Development

Centuria pays $27.8 million for twin suburban Melbourne offices

Centuria pays $27.8 million for twin suburban Melbourne offices
Written by The ReReport
As seen in the Source link, written by on 2019-11-28 20:50:33

Centuria Diversified Property Fund (CDPF) has added twin suburban
Melbourne offices to its mushrooming property portfolio.

CDPF is paying Stronghold Investment Services $27.8 million for the neighbouring buildings at 13-15 Compark Circuit in Mulgrave.

Stronghold paid $21.5 million for them in early 2017.

The office (shaded) is close to the Nissan Australia HQ, Monash University and Salta’s Nexus Corporate Park – where one of the sales agencies (Knight Frank) has an office.

Covering a site area totalling 8334 sqm, the offices contain a total of 5851 sqm of lettable area – all of which is fully leased.

Based on the annual net rental return ($1,7373,848), the property is exchanging on a 6.25 per cent passing yield.

The public sale campaign attracted six offers and 198 enquiries,
according to Knight Frank’s Tom Ryan and Tim Grant, who represented Stronghold
with Dawkins Occhuito’s Andrew Dawkins and Chris Jones.

The twin buildings each have neighbouring basement car parks.

Centuria Diversified Property Fund

This deal – CDPF’s fourth direct acquisition – sees a Sydney investor acquire a Victorian asset from a Queensland vendor.

It is anticipated to settle early next year.

Following the Mulgrave acquisition, the CDPF portfolio is
worth just over $200 million.

CDPF is an entity of the ASX-listed Centuria Capital Group
(CNI), which controls assets (now) worth $6.7 billion.

The properties: 13-15 Compark Circuit, Mulgrave

Within the revered Monash Employment Precinct, the freestanding A-grade buildings include parking for 226 cars, many within a basement.

This is a high portion of car parks for a suburban office,
according to the agents, equating to 3.9 spaces per 100 sqm of office area.

British personal healthcare giant PZ Cussons prestige
home builder, Carter Grange, and Tyco/Johnsons Controls, are amongst the office
occupiers at 13-15 Compark Circuit.

The agents marketed the staggered lease expiries of the
various tenants.

Part of the PZ Cussons tenancy. The A-grade offices contain a total of 5151 square metres of lettable area.

Centuria said the Mulgrave office
could be efficiently subdivided if required.

Though the offices are considered too valuable to replace
at present, the land it sits on is zoned Special Use Zone, meaning a variety of
redevelopment outcomes could be considered longer term.

The holding is less than 500 metres from the intersection
of Springvale and Wellington Roads (both these roads have bus services, too).

Another part of the PZ Cussons tenancy. The assets return a total annual net rent of $1.74 million.

The Princes Highway, Monash Freeway and Eastlink are
close by, the agents added.

“The Monash precinct contributes AUD $9.4 billion to the Victorian economy each year, supports more than 13,000 businesses and employs more than 82,000 people,” a Centuria statement said.

“Commercial real estate remains an attractive opportunity and we believe this acquisition is well positioned to retain and attract the long-term quality tenants that contribute to sustainable income streams.

Part of the Carter Grange fit out displaying bathroom fittings and fixtures.

Centuria’s joint chief executive
officer Jason Huljich added the company “continues to source compelling
unlisted opportunities in a low- term deposit and low-rate environment.

“CDPF aims to offer direct property investment with a minimum investment of only $10,000. The Fund is open-ended, offers limited monthly liquidity,2 and sits on a number of platforms, so it is easy for advisers and investors to access.”

The complex includes a retail component leased to a cafe.

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