This article is from the Australian Property Journal archive
FUND manager EG has continued its acquisitive streak, picking up an urban renewal site in Sydney’s inner south for its Yield Plus Infrastructure No. 2 Fund.
Currently home to two creative office buildings, the 175-177 Cleveland St property in Redfern has approval for a 45-room hotel, 20 apartments and retail on the 1,060 sqm corner block.
The fund’s strategy seeks to acquire yield-producing assets close to urban renewal and transport infrastructure opportunities.
“Positioned on the doorstep of major employment, education and transport infrastructure, it’s an exciting location and an ideal setting to showcase EG’s design excellence and Build In Good thinking around social, economic and community benefit,” EG associate director, Mark Watson said.
The property was marketed by Savills with existing net annual income of $323,029, with a demolition clause in place.
The Yield Plus Infrastructure No.2. fund was launched in August 2016 with a $750 million real estate mandate. EG recently flagged it had been analysing opportunities for the final round of investment for the unlisted fund.
It has recently picked up a fully leased St Leonards office building it recently picked from AMP Capital for $33.8 million, on a net passing yield of 5.5%, as well as a Toyota car dealership and service centre in Sydney’s north west for $23 million, with a 15 year leaseback to Servco, also at a 5.5% net yield and where it will undertake an extensive refurbishment of the property.
The EG platform has about $3.2 billion of assets under management.
EG has just secured an agreement with GIC, Singapore’s sovereign wealth fund, that will give it an initial capacity to buy up to $400 million of assets as part of a strategy similar to that of the Yield Plus Infrastructure No.2. fund.
At the same time as the St Leonards purchase, EG Funds also paid $38.2 million for an 18,514 sqm complex in Ingleburn anchored by Austcor Packaging, on a yield of 5.42%.
