This article is from the Australian Property Journal archive
THE City of Parramatta Council has paid $64 million for an office building that will become its administrative headquarters from 2023.
The seven-storey building at 9 Wentworth Street has 7,650 square metres of office space, a 5.0-star NABERS Energy rating, and basement parking.
Council’s corporate services, customer contact centre, and Councillor and Lord Mayor’s offices will be relocated from 126 Church Street and occupy part of the building, with the remainder being leased.
It was put to the market in April through Knight Frank on behalf of Mayrin Group, fully occupied with a net annual passing income of around $3,600,00. About 62% is leased to the Commonwealth government, with other tenants including the Australian College of Nursing and Wilson Parking.
Mayrin Group had bought the building less than two years ago for $62.6 million from Charter Hall Direct PFA Fund, at a 16% premium to book value.
“With major projects such as Parramatta Square, Powerhouse Parramatta, Sydney Metro West and the Parramatta Light Rail transforming our City, Council needed an office space that would serve our organisation and community well into the future,” City of Parramatta Lord Mayor Bob Dwyer said.
City of Parramatta CEO Brett Newman said the acquisition is a strategic investment and allows Council to “eliminate our existing rental obligations and take advantage of the capital appreciation that will come with owning our own building”.
“As is the case across many workplaces, the pandemic has changed the way we work and the new building will offer a mixture of activity-based and flexible-working environments to improve staff communication, collaboration and interaction.”
The announcement comes just a day after Deloitte Australia signed up at Walker Corporation’s $3.2 billion Parramatta Square precinct nearby, taking up space in what will be the largest commercial building in the country.
Together, 6 & 8 Parramatta Square will have 125,000 sqm of office space. The towers are expected for completion respectively in November and May and have secured major commitments from Westpac, and the New South Wales government’s Property NSW across nearly 44,000 sqm.
The Property Council of Australia’s latest Office Market showed an increase in the Parramatta CBD office vacancy rate over the six months in July from 6.4% to 10.2%, to its highest level in 11 years.
This was largely due to supply additions of 26,500 sqm, and the Property Council’s Ross Grove said the coming completion of 6 and 8 Parramatta Square, along with 6 Hassall Street would continue to add to Parramatta’s premium office space. Earlier this month the NSW government approved Scentre Group’s $500 million proposal to build a 105,000 sqm office tower above Westfield Parramatta.
Last year, the New South Wales government committed to overhauling planning controls for Parramatta’s CBD, hoping to create 50,000 new jobs and two million sqm of new commercial space in the process.
