This article is from the Australian Property Journal archive
IT has taken 26 years for the property value of 383 King St in Melbourne to return to the same level it was at in 1989, after private school Haileybury College bought the building from Singapore's Aspial Corporation.
The sale price was undisclosed but it is believed that the private school paid more than $50 million — a slight premium to the property`s value in the late 1980s, just prior to the 90s crash.
It is believed that Haileybury intends to convert the office space into its city campus as part of its expansion. 383 King St comprises a 10-storey building with 13,135 sqm of NLA and a basement car parking for 104 vehicles on a 2,206 sqm site.
CBRE`s Mark Wizel, Josh Rutman and Kiran Pillai handled the transaction.
CBRE senior director Mark Wizel said the sale highlights the opportunistic mindset of Asian investors who have, over the past few years, targeted Australian commercial properties as an avenue for their cross border investment strategies.
“Aspial recognised an opportunity as 383 King St had appreciated greatly in value and therefore made the commercial decision to capitalise on a quick trading profit rather than pursuing the development opportunity for which the asset was initially acquired for.
“Commentators on the Melbourne market need to understand that this cycle of Asian investment is very different to previous experiences such as when there was an influx of Malaysian capital in the mid 1990`s,” Wizel said.
“The globalisation of the commercial property market, the access and ease of information and the scale of interest both from local and overseas property players is contributing to a more liquid and transparent market than in any decade ever previously seen.
“CBRE was delighted to have acted for Aspial in this transaction and whilst bound by confidentiality surrounding specifics due to the matter effecting Aspial as a publicly listed SGX company, can confirm that sale has taken place on an unconditional basis to a Melbourne based private school who have purchased the property as owner occupiers,” Wizel added.
The sale will see Aspial turn a quick profit after it bought the vacant building in December 2013 from the Henkell brothers for $41.5 million as its first Australian property investment. That transaction was handled by Savills` Clinton Baxter and Nick Peden.
Up until the Haileybury transaction, the Henkell brothers have been the only owner and seller who have made a capital gain from the sale, after they bought it for a bargain price of $34 million from Trinity Limited in 2010.
Trinity acquired the building the National Australian Bank Superannuation Fund in 2006 for $41.6 million on a 6.05% yield. At the time, the property was sold with an eight-year lease to the NAB. However the bank vacated after 22 years of occupation when it moved to the Docklands, leaving the building empty.
Prior to that, the NAB bought the property in February 1989, just prior to the property crash of the early 1990s, for $50 million.
Australian Property Journal
