This article is from the Australian Property Journal archive
ACQUISITIVE player Quintessential Equity has made its largest single purchase, with the $115 million acquisition of a 1.8-hectare office complex in Sydney’s north west just days after being awarded a major development contract by the South Australian government.
Overlooking Lane Cove River, the A grade office estate at 3 Richardson Place has two six-storey buildings with a combined gross lettable area of 17,187 sqm. It will be the second asset in Quintessential Equity’s $300 million blind fund, known as Master Fund No.2.
The deal was struck on a passing yield of 6.7%, which would lift to 6.75% once the building is fully leased. It is currently 99% occupied, with existing tenants including the Council of the City of Ryde and software developer Pronto Software.
“Quintessential Equity will actively manage all existing tenants to derive long-term stable outcomes and is in discussions with a new tenant to lease the remaining vacancy,” the developer and private equity company said.
“Located in a growing office hub with a diversified tenant profile, 3 Richardson Place ticks all the boxes of our buying mandate criteria,” executive chairman, Shane Quinn said.
“High occupancy upon purchase has meant distributions will be experienced immediately following a patient wait by our investors while we found the right asset.”
North Ryde has retained a vacancy rate of under 4% throughout the pandemic, according to Quintessential Equity.
“The future of office real estate remains uncertain however we are confident in our decision to purchase in a favourable location that attracts high-calibre local and global corporate tenants. Compared with other Sydney locations, the estate provides a competitive rental rate for tenants looking to cut down business costs post-COVID with A-grade office space under $250 per square metre net effective rents.”
Located 15 kilometres from Sydney CBD, the property includes more than 600 parking spaces, offers an on-site café and gym, end of trip facilities and a private bus service to North Ryde train station, as well as access to rail and road networks. They include the recently upgraded North Ryde train station and the M2 Motorway.
The completion of the Sydney Metro City and Southwest lines in 2024 will create a 20-minute journey between North Ryde and the city centre.
The deal was brokered by Colliers agents Jon Chomley and Sophie Tieman.
Quintessential Equity’s Master Fund No.2 also comprises an $18.5 million industrial asset that it just picked up in Brisbane’s Rocklea.
Just last week, Quintessential Equity was chosen by the South Australian government to develop and own the $400 million Entrepreneur and Innovation Centre within Adelaide’s Lot Fourteen precinct.
The 16-level building will comprise 35,000 sqm of commercial, research and networking spaces, catering to the spanning defence, space, hi-tech and cyber security industries.
It will form part of the broader $722 million Lot Fourteen redevelopment that is backed by the state and federal governments, and is a key focus of the Adelaide City Deal that will see transformation of the former Royal Adelaide Hospital site into an innovation precinct.
Commitments have already been made by Amazon, the Australian Space Agency, the SmartSat Cooperative Research Centre, MIT bigdata Living Lab, the Australian Institute of Machine Learning, and the Australian Cyber Collaboration Centre.
Meanwhile, Quintessential Equity has just topped out construction of its new $100 million office building in Victoria’s Geelong. Overlooking Corio Bay, nine level A-grade building will be anchored by GMHBA.
