The $148 billion Future Fund, along with co-investors Victoria Funds Management and Funds SA, is a step closer to selling a $200 million office tower in Sydney with specialised real estate investment and advisory group Ashe Morgan in due diligence to buy the asset.
Future Fund is actively recycling key office assets including a New York office tower to a Japanese real estate company for about $600 million that on face value helped double its money.
The latest Sydney deal involves the sale of a 15,500-square-metre office tower at 9 Hunter Street – an asset that represents one of only 15 A-grade office towers that is held in 100 per cent ownership in the core market.
JLL’s Rob Sewell, Paul Noonan and Stuart McCann alongside CBRE’s James Parry and Michael Andrews were appointed to sell the asset in July.
It is understood Ashe Morgan is buying the asset on a price that would reflect a yield in the low 5 per cent range. The purchase is to be made on behalf of an overseas mandate.
The three investors that own the asset are unitholders in the Value Active Fund managed by CorVal. The fund has reached the end of its life.
CorVal, Ashe Morgan or the agencies could not comment on the sale process.
CorVal has made significant gains on properties this year for Future Fund. It sold on behalf of the same investors an office building in Brisbane for $133 million to Germany’s biggest pension fund.
The same Value Active Fund No.1 purchased that Brisbane building at 160 Ann Street about five years ago for $82 million and is now selling it to Alpha Investment Partners on a yield of about 6 per cent.