This article is from the Australian Property Journal archive
FUND manager EG has closed its Core Plus Fund 1 following the sale of Brisbane neighbourhood shopping centre, North West Plaza for $42.5 million.
Assets within the portfolio have included office building at 92 Pitt Street in the Sydney CBD, 223 Liverpool St, Darlinghurst and 277 William St in Melbourne, which were all turned for tidy profits.
The fund will deliver net returns to investors of more than 20% EIRR.
North West Plaza, in Everton Park, was listed for sale in September after being repositioned. EG outlaid $2.4 million for upgrade works, having picked up the 9,489 sqm single-level centre for $41.2 million in September 2014.
Core Plus Fund 1 was initiated in 2014, with a total gross acquisition asset value of $231 million across seven assets over a three-year acquisition horizon. The fund consisted of office, industrial and retail properties across the major east coast capitals that had uplift potential via strategic capital works and active asset management initiatives.
EG sold 277 William St last year for $93.88 million, less than three years after paying Harry Stamoulis $45.9 million for the 12,080 sqm office tower. The fund re-let over 70% of the property and introduced a new ground floor lobby, added retail amenity and upgraded infrastructure throughout the building.
Late in 2016, EG quickly sold off two Sydney assets at healthy premiums to their purchase prices. Acquired for $30.6 million less than two years earlier, the 4,642 sqm 92 Pitt St building was sold for $52.17 million, and the heritage-listed Holdsworth House at 223 Liverpool St was offloaded for $33 million, just two years after being picked up for $17.45 million.
“We are incredibly happy with the performance of CPF1. The Fund has vindicated the investment strategy of identifying and acquiring assets which disproportionally benefit from repositioning while also ensuring strong underlying cash-flows on limited downside risk” divisional director, Daniel Farley said.
The successor fund, EG’s Australian Core Enhanced Fund has completed its first close of $500 million and is open for further investment for the next 12 months.
