This article is from the Australian Property Journal archive
GARDA Property Group has listed Cairns Corporate Tower – North Queensland’s dominant office building – for sale after almost 20 years of ownership, with a sale set to complete the ASX-listed trust’s transformation into a lowly-geared pure-play industrial REIT.
Located in the heart of Cairns’ CBD, at 15 Lake Street, the 15-storey tower was originally developed in 1989 and has over the past decade received a full refurbishment costing in excess of $20 million.
CBRE’s Danny Betros and Mark Witheriff are managing the marketing campaign for the sale. They would not be drawn on price, but sources told Australian Property Journal a figure in the mid-$80 millions is expected.
The property was valued at $79.4 million in December.
Expressions of interest closes on March 6th.
The building has 14,843 sqm of floor space and its longstanding tenants include major corporates, as well as federal and state government departments.
Cairns Corporate Tower is the sole office building within the Garda portfolio which is now largely focused on “develop to own” industrial.
“Having spent the best part of a decade repositioning this asset, we are both proud and excited to offer Cairns Corporate Tower to the market. The iconic building represents a compelling investment opportunity for buyers looking to acquire a dominant building in a low leasing incentive market,” said Garda Property Group executive chairman, Matthew Madsen said.
“Garda Property Group aims to unlock value for our shareholders and release capital for redeployment into the strategic growth areas within our business.”
Garda in October has sold its 25-hectare industrial development site in North Lakes, in the City of Moreton Bay, for $114 million, saying it was “disappointed” to not be development it out but “the scale of this project is simply too large for Garda to deliver in the current environment”.
Elsewhere in its industrial portfolio, a 14,777 sqm Acacia Ridge industrial facility at 38-56 Peterkin Street reached practical completion in December.
A year ago it offloaded Botanicca 7 and Botanicca 9 office buildings in inner Melbourne at hefty discount as devaluations washed through the sector.
Including the Cairns Corporate Tower, Garda’s portfolio currently stands at $513 million, with a 4.5-year weighted average lease expiry and a 6.21% capitalisation rate,
Growing lending revenue
Garda reported $7.368 million in funds from operations in the first half of FY25, up by $413,000 on the prior corresponding period.
It posted a loss of $10.193 million, although this was an improvement from a $34.6 million loss.
Distributions were down by $225,000 to $6.362 million.
Garda has been increasing its exposure to property lending, representing 4.8% of total assets and 21% of FY25 forecast group revenue.
Garda had $27.5 million in deployed loans at December. During the half-year, Garda advanced to third parties $11,867,000 and $13.5 million was repaid with run-off of the loans matched by new deployment.
