Australian Unity Investment Real Estate Limited as Responsible Entity for Australian Unity Office Fund (AOF) today announced that the following four properties owned by AOF have been externally valued as at 31 December 2017:
10 Valentine Avenue, Parramatta
468 St Kilda Road, Melbourne
2 Eden Park Drive, North Ryde
64 Northbourne Avenue, Canberra
Combined these valuations have resulted in an estimated increase of $20.5 million or 10.5% over the preceding book value for those properties externally valued. This equates to an increase in AOF's net tangible assets of approximately 13 cents per unit. The weighted average capitalisation rate across the portfolio tightened from 7.5% as at 30 June 2017 to 7.0% as at 31 December 2017 (which includes the acquisition of 150 Charlotte Street, Brisbane).
Strong investment demand, particularly in Sydney and Melbourne and their associated metropolitan markets, has led to a compression in capitalisation rates from prior valuations. This has been complemented by some increases in market rents due to solid leasing conditions in most markets.
AOF's Fund Manager, Grant Nichols, said 'There continues to be very strong demand for well located Australian CBD and metropolitan office assets. We expect this strong investment demand to continue and AOF's portfolio is well positioned to further capitalise on these market conditions'.
Further details relating to individual property valuations will be announced in AOF's half year 2018 results on Tuesday, 6 February 2018.