Centuria / Blackrock confirms Zenith Centre sale
Centuria and Blackrock have confirmed the sale of the Zenith Centre Chatswood for $438.2m. The purchaser is US Fund Manager Starwood Group, lead locally by Arrow Capital Partners. The transaction is expected to reflect a yield of around 6 per cent.
Arrow Capital is a venture between former Valad Europe owner Martyn McCarthy and former Brookfield local property head, Kurt Wilkinson. The pair won the backing of US group Starwood Capital in 2017 on another major office deal in St Leonards.
The twin 21-storey, A-grade office towers, with a net lettable area of about 44,400 square metres, new end of trip facilities and basement car parking for 785 vehicles. The towers were built in 1987 and upgraded in 2011. The Zenith Centre is fully let to Property NSW, Commonwealth Government of Australia, Lendlease and Sage with a WALE of 4.3 years.
The transaction was managed by Knight Frank and CBRE.
The two joint vendors, have made a substantial capital gain having bought the asset from DEXUS and GPT in 2016 for $279 million. Centuria have confirmed that they expect to generate a performance fee of over $9 million from the sale which will be deployed into real estate and capital management initiatives for Centuria.
Since acquisition in 2016, Centuria and Blackrock completed a strategic capital works program including foyer refurbishments, the commencement of lift upgrades and best in class end of trip facilities to improve amenity and provide an attractive destination for tenants in a strengthening suburban office market. During this period, 58 new lease deals across more than 40,000sqm of space was completed, achieving 100% occupancy and an improved WALE from 2.5 to 4.3 years.