Investors circle $800m Chevron tower in Perth
By Nick Lenaghan and Ingrid Fuary-Wagner
Canadian property giant Brookfield has begun combing through a shortlist of three or four candidates to invest in an $800 million new Perth headquarters for resources giant Chevron.
The process to identify a joint investor to take a half stake alongside Brookfield itself has been through multiple rounds after 11 or so parties were invited to bid.
Among the contenders for the 29-storey tower are US funds giant Invesco, local investment platform AMP Capital as well as Singaporean players.
A deal on the half stake could take its investment yield down to between 5 per cent and 5.25 per cent, according to senior sources, a sign that the Perth market, for so long in doldrums, is now open to institutional money at the top end.
The tight yield is also an indicator of the bond-like character of the investment, with Chevron’s initial tenancy to run for decades potentially.
In an unusual development process, it was Chevron itself that first put its foot on a site for a new corporate headquarters at Perth’s Elizabeth Quay precinct.
Chevron paid $64 million in 2013 to buy into the urban redevelopment project, taking over the 6800-square-metre Lot 7.
The resources powerhouse then ran a tender process for a developer to build a new premium tower that it could occupy for a lease term of about 25 years.
High-rise plans
Brookfield was selected to develop a 29-storey tower with 52,785 square metres of office space.
With floor plates of 2000 square metres, the tower will look south over the Swan River and east over the Supreme Court Gardens and Langley Park.
Brookfield then launched its own process two months ago, bringing in JLL and Cushman & Wakefield to identify prospective investors.
Chevron is currently headquartered in the QV1 building until 2023.
Brookfield is busy elsewhere in the Elizabeth Quay precinct.
Across lots 5 and 6, Brookfield has committed to developing a $1.1 billion mixed use twin-tower project, including one of the CBD’s tallest towers in a project designed by New York architects REX.
Momentum is building at the waterside regeneration zone, where Hong Kong mega-developer Far East Consortium – which is also active at the Perth City Link redevelopment – is building a cluster of residential towers and the Ritz-Carlton Perth.
