This article is from the Australian Property Journal archive
INVESTA has emerged as the buyer of the 117 Clarence St building in Sydney’s CBD, having paid $153 million for the 14-storey building to Roxy-Pacific and Tong Eng Group’s joint venture company Feature-Roxy Pty Ltd.
The Singaporean vendors did not disclose the buyer when the transaction was initially revealed in May. Investa Commercial Office Fund (ICPF) acquired the asset as trustee for Clarence Street Precinct Trustee.
Feature-Roxy completed their $81 million acquisition of the B-grade building in February 2016, meaning the 50-50 partnership has realised a massive value gain of $72 million in little more than two years as the Sydney office market continued to receive hefty local and offshore demand and dwindling supply.
They had purchased it from Altis Property Partners, which had refurbished the building after themselves buying it for $61.25 million in 2013 from AMP Capital.
The latest deal has seen the asset trade with 100% occupancy, anchored by the NSW government and returning a fully leased net passing income of $7.6 million, with a weighted average lease expiry by income of 2.5 years.
Savills’ Simon Fenn and Ian Hetherington, in conjunction with Inc RE’s Josh Cullen and Steven Kearney, negotiated the sale.
Teo Hong Lim, executive chairman and chief executive officer of Roxy-Pacific, said the group had entered the Sydney commercial market relatively early, seeing good potential to capitalise on the favourable market cycle.
“The divestment of 117 Clarence Street closely follows the sale of 59 Goulburn Street, both prime commercial buildings in Sydney had contributed healthy recurring income before they were divested at a good price.
“We hope to replicate this model and extend our investment track record in the near future, recycling the capital from the sale of 117 Clarence Street into other yield-accretive investments to enhance shareholder value.”
Roxy-Pacific sold its 23-level, A-grade 59 Goulburn Street tower in Sydney for $158 million last year, delivering another bumper profit in a short period of ownership – in this case, nearly $68 million above the purchase price just three years earlier.
The 18,867 sqm building also sold with the NSW government as anchor tenant, with 98% occupation an estimated passing income of $8.13 million.
Late last year, a joint venture between Roxy-Pacific and Teo Tong Lim’s private family office vehicle purchased the seven-level, 9,854 sqm building at 312 St Kilda Road on Melbourne’s CBD fringe for $74.14 million from Myer Family Investment. Roxy-Pacific has a 45% interest in the building.
It quickly followed that with the $33 million acquisition of the six-storey Melbourne House at 360 Little Bourke Street in the CBD, which traded with two short-term leases. The group is planning a hotel and retail development for the site.
Australian Property Journal
