This article is from the Australian Property Journal archive
SHIMAO International is shopping around a half-share in the A-grade 175 Liverpool Street office tower in Sydney’s CBD, looking to capitalise on the massive value gains in the city over recent years and ongoing confidence from investors.
The tower is believed to currently hold a value of circa $800 million and Shimao, overseen by Chinese billionaire Hui Wing Mao, paid $392 million for the 31-storey building just four years ago to Singaporean group GIC.
Known as 175 Hyde, it is located directly next to Hyde Park and offers panoramic views over the CBD, Opera House and the park to Sydney Harbour.
The asset is currently fully leased with tenants including Telstra, the NSW Government and the Federal Government. The NSW Land Registry Services has just leased one and a half floors within the building on a five-years-and-six-months deal.
CBRE’s Sharon Yang and James Parry are marketing the 50% stake in the tower via expressions of interest closing 4pm on December 6.
Yang said the asset is “perfectly positioned to capitalise on today’s favourable market fundamentals”, and that there is “significant” development potential given its positioning on one of Sydney’s few large-scale, freehold island sites and its status as the last north-facing Hyde Park opportunity.
“This is an ideal opportunity to in invest an A-grade commercial asset with an excellent income, while positioning to capitalise on the high-end residential market in the future, when there are expected to be fewer and fewer opportunities available to buyers.”
The tower was extensively refurbished in 2009 and 2013. It has a total lettable area of 48,877 sqm, including ground floor retail space, and parking for 423 cars over four basement levels.
Shimao International’s Jerry Li the sale plans provide an opportunity for the group to “partner with a like-minded investor and share in the building’s future upside as Sydney’s market fundamentals continue to strengthen”.
Yang said 175 Hyde was expected to receive a substantial uplift in rental income as existing leases expired due to constantly improving market conditions, and is positioned to capture the next upswing in Sydney’s residential market, coinciding with the asset’s major tenant expiries in 2024.
The current weighted average lease expiry is 3.68 years.
“Over recent years, multiple luxury residential developments, hotel additions and dynamic urban spaces have been completed in the surrounding precinct,” Yang said.
“175 Hyde holds the box seat as the anticipated availability of these sites become scarce.”
Savills Australia’s Rob Dickins negotiated the NSW Land Registry Services lease at $985 per sqm. It will relocate from its current offices opposite St Mary’s Cathedral on April 1 next year.
Australian Property Journal
