This article is from the Australian Property Journal archive
SINGAPORE’S sovereign wealth fund GIC has taken a 25% interest in the future Chevron headquarters on the Swan River, in one of the first major Perth CBD office building deals of the year.
The deal with Brookfield is believed to come in at about $220 million.
Oil and gas giant Chevron will anchor the 29-storey Elizabeth Quay tower at One The Esplanade, agreeing to take up 78% of its 56,000 sqm.
Brookfield acquired the site from Chevron two years ago as part of an agreement to develop the building, which will include retail and dining. Chevron itself had picked up the 6,800 sqm site in 2013 for $64 million, and appointed Brookfield as developer in 2018.
The Canadian group will retain a 25% share of its own in the building. US-based Invesco took a 50% share 12 months ago for $400 million, indicating the tower’s value has risen in that time.
There have been concerns predating COVID that the new tower would contribute to Perth’s office space oversupply problem. Perth’s CBD office market vacancy rate returned to the 20% mark after a 1.6% increase over the past six months.
Chevron is currently at 256 St Georges Terrace, where it has a lease until December of 2023 over 14,000 sqm.
Elizabeth Quay has fast become a development hub, owing largely to Brookfield’s ambitions. Brookfield secured approval from the Western Australian government for a $1.1 billion, dual-tower project at Elizabeth Quay in October.
The taller of the towers, at Lot 5, will consist of retail, waterfront dining and prime commercial office space, residential dwellings and an 84 room hotel, and will be accompanied by a 21-storey prime commercial building at Lot 6 – next to Chevron’s future HQ at Lot 7 – and the Ritz Carlton.
Brookfield already owns waterfront towers Brookfield Place Tower 2 and 108 St Georges Terrace, also known as the Bankwest tower.
On the opposite side of the country, it has just offloaded a 50% share in a Wynyard building at 60 Carrington Street to Marprop Real Estate for $140 million, close to its $2 billion Wynyard Place development.
GIC active down under
GIC has emerged as an active player in Australia’s commercial real estate market during the pandemic.
During the nationwide shut down, in partnership with Dexus it acquired a half-stake in Melbourne’s Rialto Towers for $644 million, and through the two parties’ logistics trust acquired two facilities in Melbourne and Sydney for $173.5 million.
Also in the industrial space, it boosted its interest in the ESR Australia Logistics Partnership to 80%, and backed EG Funds Management with a $400 million mandate.
In another partnership, GIC teamed up with Charter Hall to take a 49% stake in a new $1.4 billion Ampol Property Trust that will own 203 convenience retail properties across Australia.
