This article is from the Australian Property Journal archive
NON-bank lender Merricks Capital is financing the Milligan Group’s acquisition of one of Sydney’s late remaining major CBD sites, through a $465 million funding agreement.
The purchase of the strategic site, located on the corner of Pitt and Hunter Streets, comes after five years of planning and the aggregation of four buildings and 71 individual titles.
Milligan Group has earmarked the newly formed site for the construction of a 220 metre 55-storey mixed-use commercial tower, that is set to become the world’s tallest hybrid timber tower.
“The Milligan Group is to be commended for their tireless efforts putting the site together and we look forward to working closely with James Milligan and his team to deliver the project,” said Dan O’Donoghue, head of private credit at Merricks Capital.
“This is another step in the transformation of the City of Sydney, and the development, valued at approximately $2 billion once complete, will have strong cultural and economic benefits.”
The site will also be developed to integrate with the planned Hunter Street Metro Station, which with its 2030 completion date is expected to become one of the Southern Hemisphere’s busiest train stations.
“The acquisition shows that there is a strong market outside of the major banks to fund high quality assets at sensible valuations,” added O’Donoghue.
O’Donoghue also noted that the complex agreement needed d close co-operation with local and international investment partners, reflecting Merricks Capital’s capabilities in both the private credit market and the commercial real estate sector.
“We are delighted to have secured this funding. Full credit is due to Merricks Capital and our legal teams, whose support and expertise have been invaluable during the complex process of bringing this site together, and I thank them for their contribution,” said James Milligan, founder at Milligan Group.
The new generation, sustainable office building has been designed with the effort to encourage staff back to the office in mind, playing off feedback from employees around shortening the commute and working in high quality, sustainable spaces designed for both collaboration and lifestyle.
“We have worked closely with the Milligan Group and other stakeholders to reduce the risk of the project through positive planning outcomes, a clear pathway to repayment of our facility and the construction of a world class office building,” said Adrian Redlich, chairman and chief investment officer at Merricks Capital.
“We enable our investors to invest in private credit that has historically only been accessed through large multi-national institutions.”
In December last year, Merricks Capital placed the $155 million Melbourne Place hotel development in the Melbourne CBD into voluntary administration following payment defaults by the developer.
