This article is from the Australian Property Journal archive
Charter Hall has paid $14.7 million to buy Emirates House, its first CBD office building in Perth.
Located at 181 St Georges Terrace in the Western CBD precinct, Emirates House is a modern seven storey office building completed in 2001 and has a net lettable area of 3,584 sqm on a 696 sqm site.
Charter Hall’s joint chief executive officer David Harrison said the latest purchase is the fifth property acquisition in 6 months for by the Charter Hall Diversified Property Fund.
He added that given the current fundamentals in the Perth market, the purchase takes advantage of both fixed annual increases and market rental growth review opportunities over the next few years.
“We are bullish on the Perth market and are delighted with our purchase of this modern, well located building. We are also exploring a number of other opportunities for other Charter Hall managed funds to invest in Perth investment and development projects.” Harrison added.
The sale was negotiated in an off market transaction by Savills’ Perth managing director Paul Craig and Miles Rowe.
Craig said Emirates House is virtually fully leased, with only a small vacancy at ground floor level.
“The building is leased to a number of high quality tenants including Cape Bouvard, Emirates, Elders and Commonwealth Bank of Australia There has been increased appetite for investment grade property of this calibre.” he added.
Rowe said Perth’s rents have been held at artificially low levels for many years by the oversupply hangover, however rising tenant demand lack of supply and a booming resource and service sector is changing the office market dynamics.
“The current supply demand scenario and inflationary pressures on building costs are good news for owners of existing buildings and we forecast strong renal growth over the next 3-4 years” Rowe concluded.
The latest sales follows a hat trick year in 2005 for Savills’ Perth office, which comes hot on the heels of major sales including the Kwinana Hub for $32 million and Wesfarmers House for $47.5 million, two of the most significant Western Australian office and shopping centre sales of 2005.
By Nelson Yap
