This article is from the Australian Property Journal archive
CROMWELL’S busy end to 2017 has continued, with the $42 million purchase of a fully refurbished office building in Brisbane’s inner suburb of Spring Hill.
It has also appointed Simon Garing in the new role of chief capital officer.
The 6,000 sqm Spring Hill property at 433 Boundary Street has a WALE of around 12 years and traded at a 6.7% yield, and has International Education Services as its major tenant, which works with organisation including the University of Queensland in offering services for international students and educational professionals.
The asset was purchased from Alceon, which paid $22.5 million for it just last year, will be placed in the Cromwell Direct Property Fund.
Hamish Wehl, head of retail funds management at Cromwell, said the Boundary Street investment was set to be a compelling addition to the DPF portfolio.
“The education sector is growing substantially and is Australia’s third largest export behind iron ore and coal. IES, as a global leader in education services, is well positioned to benefit from the influx of international students coming to Australia,” Wehl said. “With the Brisbane City Council’s clear agenda to continually attract more students to the city, combined with their vision to rejuvenate the Spring Hill precinct, Boundary Street will add long-term value and diversification to the fund.”
Cromwell recently sold off the Health and Forestry House buildings on Charlotte Street and Mary Street in Brisbane to AsheMorgan for $66 million. While it was a tiny increase on the $65 million it spent on them in 2013, it received a healthy 20% yield each year
Last week, the group acquired Adelaide’s Calvary Wakefield Private Hospital and Medical Clinic for $50 million from Australian Unity’s Healthcare Property Trust, just days after attracting the attention of Chinese real estate power couple Gordon Tang and Celine Tang. They took a $170 million stake in Cromwell via their Singapore-listed property vehicle SingHaiyi Group Ltd, which counts Neil Bush – brother and son of former US Presidents George W. Bush and George H.W. Bush – as a director.
The Tangs were described by Cromwell’s chief executive officer Paul Weightman as “cornerstone” investors of the Cromwell European REIT, which listed on the Singapore stock exchange late in November following a false start in the months prior.
Garing has joined from Bank of America Merrill Lynch Hong Kong, where he was deputy director of research – Asia Pacific, and has been a global real estate capital markets manager, analyst and investor over 25 years, predominantly with bulge bracket investment banks.
Weightman said the IPO and placement were examples of Cromwell’s ability to access capital from a range of different sources across the globe, particularly from Asia, and it was looking for someone with the experience, knowledge and capability to help drive further growth in this area.
Garing said, “Capital is increasingly global, with Asian capital, in particular becoming more prevalent in international markets. This trend can only continue, and I admire Cromwell’s strategy to attract these flows with a single-minded purpose to drive value for investors.”
Australian Property Journal
