This article is from the Australian Property Journal archive
THE Investa Commercial Property Fund has bought into Canberra’s newly-completed Constitution Place, developed by Terry Snow’s Capital Property Group, in a $275 million deal.
ICPF has taken the 22,300 sqm 220 London Circuit, one of two buildings within the mixed-used complex that was completed last year.
Adjacent to the ACT’s Legislative Assembly in the Canberra CBD, the five-level 220 London Circuit building is predominantly leased to the ACT government until 2041 and has a weighted average lease expiry (WALE) of 18.5 years, and traded on a circa 4.5% yield.
“220 London Circuit is a prime asset in this highly desirable location. The acquisition delivers on ICPF’s strategy of owning prime assets with leading ESG credentials in core locations, delivering solid rental growth,” ICPF fund manager, Brendan Looby said.
“The AAA rating of the major tenant, the ACT government, enhances the quality of underlying earnings and improves portfolio occupancy, WALE and diversification, while complementing the fund’s active development pipeline.”
The building incorporates seven retail tenancies including a restaurant, gym, end of trip facilities, and parking for about 400 cars.
It is designed to achieve a 4.5 Star NABERS Energy Rating and was one of Canberra’s first WELL-rated buildings, achieving Gold Certification under the WELL Building Standard.
Jason Leong, head of investment management, Investa said the Canberra office market “continues to be resilient and underpinned by solid market fundamentals, with the lowest vacancy rates across the capital cities and steady rental gains particularly over the past 12 months”. Canberra’s office vacancy was up 6.3% to 8.6%, according to the Property Council.
The Constitution Place deal comes as Charter Hall is reportedly in due diligence with German investment manager Real IS to acquire the Geoscience Australia building in Symonston for more than $370 million, while expressions of interest closed last month for the Australian Taxation Office building at 21 Genge Street that could fetch up to $400 million in what would be a record office building deal for Canberra.
Australia Unity Office Fund is shopping around the 6,375 sqm 64 Northbourne Avenue building home to the Australian government’s Defence Force recruiting.
Earlier this year, Molonglo Group sold off the 33 Allara Street building for $71 million, while the record 2021 year closed Singaporean sovereign wealth fund GIC partnered with Charter Hall to acquiring the federal government-tenanted 50 Marcus Clarke Street in Canberra for $335 million and ASX-listed Growthpoint picking up the ACT Department of Health offices for $84.6 million.
