This article is from the Australian Property Journal archive
SINGAPOREAN investment house ARA Asset Management is hoping for over $90 million from a St Georges Terrace office building leased to the Western Australian government, as activity in Perth’s CBD ramps up following the reopening of borders in March.
Refurbished in 2016 and 2017, 81 St Georges Terrace is 98.7% occupied by the Minister of Works (Health Corporate Network) and Snap Fitness, providing a 3.9 year weighted average lease expiry by area and returns a fully leased income of $7.6 million each year.
The building has 12,233 sqm of net lettable area, across 11 levels of office accommodation and 838 sqm of ground-floor retail, situated on a 1,397 sqm site. It has a 5-star NABERS Energy rating,
Josh Cullen, Mark Hansen, Nick Rathgeber and Leigh Melbourne of Cushman & Wakefield have the listing.
“The security of income to the government of WA, combined with the core CBD location will be attractive to local and offshore investors looking for an Australian safe-haven investment,” Cullen said, adding that investors “like some Perth exposure in their portfolios to complement east coast assets”.
West along St Georges Terrace, Hawaiian has listed number 216, known as London House, for sale. Expectations are of $115 million to $120 million for the 17-level A-grade building.
Cushman & Wakefield’s WA joint managing director, Digby Sutherland said office leasing demand was at the highest level for 10 years.
According to the Property Council, Perth’s office vacancy rate is at 15%, its lowest reading since July 2015. In contrast, JLL data shows the CBD recorded positive net absorption of 9,300 sqm in the March quarter – the strongest quarterly net absorption result since the last three months of 2018 – but the vacancy rate remains elevated at 19.7%.
“Perth is the resources capital of Australia, and the increased leasing demand is directly related to the current strength of the mining, oil and gas industries and the flow down effect for downstream businesses,” Sutherland said.
Expressions of interest for 81 St Georges Terrace close 8th June.
