This article is from the Australian Property Journal archive
AUSTRALAND has snapped up the former Stock Exchange House in Collins St, Melbourne from a Malaysian investor.
Australand paid $45 million for the property at 351 – 357 Collins St from Melbourne-based members of the Mah family who run Malaysian property company Maxicity.
The property was formerly home to the Australian Stock Exchange until the 90s and Maxicity bought it as a vacant building in 1994 for $10.85 million. The property has since sat vacant for over 15 years and a major renovation was planned but remains incomplete.
The property was expected to fetch around $50 million.
Australand will settle on the acquisition in early June of this year.
The 22-level building comprises approximately 22,000 sqm of vacant office space, which is intended to be refurbished into A-grade office accommodation, leased up and retained by the group.
Australand’s managing director Bob Johnston said the group will complete the proposed refurbishment in the second half of 2011, when there is forecast to be limited competing quality office supply in the Melbourne CBD – vacancy rates are expected to drop to as low as 2%.
The estimated value of the project on completion is expected to be approximately $145 million.
“This acquisition is in line with our strategy and is forecast to provide strong investment returns. The asset will be repositioned, leveraging the group’s strong development skills, and will complement the existing high quality portfolio already held by the group.
“Retaining the completed asset is consistent with the group’s strategy to maintain recurrent earnings at 60 – 70% of total earnings,” he concluded.
Australian Property Journal
