The flurry of office sales in Brisbane continues, with a Sydney investor this week settling on the $18.8 million purchase of a 1920s building and Dmann Corporation tipped to pay more than $50 million for 444 Queen Street.
City of Brisbane Investment Corporation (CBIC) flipped the former Gordon & Gotch building, built in 1927, at 262 Adelaide Street four years after buying it for $9.1 million.
Chief executive Kirsty Rourke said extensive renovation and remedial work was done on the six-level building, which was “pretty run down” when acquired.
Fully leased following a campaign that ran through COVID-19, it attracted plenty of interest, mostly from syndicators, before it was sold to a high-net-worth buyer on an initial yield of 5.96 per cent.
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Ms Rourke said the divestment was part of a portfolio rebalance by CBIC, which over the past 18 months has also sold the South Regional Business Centre at Yeerongpilly for $35.2 million and a $9.1 million industrial development at Wacol.
“We are on the hunt to buy and have $125 million to deploy,” Ms Rourke said.
“We’re still keen on Brisbane and want to be part of the economic recovery, so we’re looking at potential development opportunities up here.”
CBIC has identified two specialist disability accommodation projects it would like to develop: an apartment complex in East Brisbane and a shared housing project at Everton Park.
Canberra also on the cards
Ms Rourke said income plays were also attractive. “Canberra’s probably our key focus in terms of looking for something that is long WALE (weighted average lease expiry) and government leased.
“Then we’re also looking for industrial – like everybody else – in Sydney or Melbourne.”
The priority was providing a risk-adjusted return to Brisbane City Council, Ms Rourke said.
The other big Brisbane CBD transaction involves Dmann Corporation, led by local property identity David Mann, understood to be in exclusive due diligence on 444 Queens Street.
The 56-year-old building, owned by Abacus Property Group and the Public Trustee of Queensland, is viewed as a turnaround opportunity and expected to settle soon at the lower end of the $50 million to $60 million guide.
Meanwhile, Knight Frank is marketing a 27-level office building managed by Investa at 179 Turbot Street with hopes of about $200 million.
No. 1 Brisbane, a package of three buildings on Queen Street Mall owned by Charter Hall that has been marketed with a price guide of about $120 million, also remains on the market.
Major Brisbane sales this year include 307 Queen Street for more than $200 million and the acquisition by Cromwell Property Group of 545 Queen Street for $117.5 million, both in early May.
They followed strong results for the office towers at 10 Eagle Street, which fetched $285 million, and 310 Ann Street, bought by Ashe Morgan for $210 million.
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