Cromwell Confirms 400 George Street Brisbane buy at $524.75M
Cromwell have announced the acquisition of 400 George Street Brisbane for $524.75m from Blackstone and German group HSBC Trinkaus in the largest deal to hit the Brisbane market in years.
The building, opened in 2009, has four levels of basement parking for 221 vehicles, three ground-floor retail tenancies and spans 43,493sq m of commercial and retail space and generates in excess if $32.2m pa in net income. The sale to Cromwell represents a passing yield of 6.14% and a capital value of $11,932/sqm of NLA.
The building is leased to a range of tenants including Accenture, the Australian Building and Construction Commission, the Australian Competition & Consumer Commission, Commonwealth Bank, Queensland and federal government departments, Microsoft and various legal tenants, with a weighted average lease expiry of 4.9 years.
The A-grade building was developed by Leighton Properties and Grosvenor Australia Investments. Leighton sold its half-interest to Trinkaus in 2007 for $210m and Grosvenor sold its half-stake in 2013 for $178m to South Australia’s Motor Accident Commission on an initial yield of 6.9 per cent. Blackstone later picked up its half-interest when it bought the $500m-plus MAC portfolio and it paid $210m for its stake.
Cromwell’s Chief Executive Officer, Paul Weightman, commented, “We continue to look to recycle capital from assets where we have already added significant value, as we have done with Northpoint Tower in North Sydney, to ones where we see new opportunities such as 400 George Street.”
The transaction is subject to Foreign Investment Review Board (FIRB) approval and is expected to settle next month
The deal was brokered by CBRE and JLL.