Knight Frank claims biggest commercial property sale deal for 2016 - so far
Australia’s biggest property deal so far in 2016 – the $578 million sale of a riverside Melbourne complex – has been claimed by global real estate consultancy Knight Frank.
Not only has the transaction set a record for the year, it is also the company’s biggest ever deal in Australia.
#Melbourne’s iconic Southgate complex has sold for $578m – the largest deal ever made by #KnightFrank in Australia pic.twitter.com/11wGrg8Ow3
— Knight Frank AU (@KnightFrankAu) August 11, 2016
The deal for the Southgate office and retail asset in Southbank was finalised earlier this month, The Australian Financial Review reports.
However, it is expected to take a year to transact on the agreed terms and is still subject to Foreign Investment Review Board approval.
Agent Martin O’Sullivan, who finalised the deal, said the sale was hotly contested by offshore investors who had been identified by Knight Frank’s offices in Asia.
“The hunt for yield in a global sense is red hot and Australia’s safe haven status adds further interest in our office sector,” Mr O’Sullivan said.
“We see this as a continuing trend which will underpin and even result in improving values.”
Glittering prize: The Southgate complex comprises the HWT and IBM towers as well as a shopping centre and carpark. Photo: Knight Frank
The buyer is Singapore company ARA Asset Management, which reportedly first approached the seller, Dexus Property Group, late last year.
Half of the sale will be settled in the December quarter and the remainder after July 2017.
The 76,000-square-metre Southgate complex comprises two A-grade office buildings – HWT Tower and IBM Centre – a shopping centre and a basement carpark.
Dexus will continue to manage the Southbank asset until it settles fully.
“From our perspective, we’re an active manager, we’ve got a significant development pipeline, and the price was compelling enough for us to look at recycling the capital into other opportunities that we have,” Dexus chief executive Darren Steinberg told The Australian Financial Review.
ARA has already acquired a $188 million Brisbane office tower and an $84 million Perth tower this year.
In 1986, Knight Frank oversaw the sale of the Qantas Centre in Sydney for $200 million. At the time it was Australia’s biggest single biggest property deal.
Other big Knight Frank deals this year include 1 Collins Street, Melbourne – $125 million; Satellite Corporate Centre, Mulgrave – $87.6 million; 533 Little Lonsdale Street, Melbourne – $35.25 million; 117 Clarence Street, Sydney – $81 million; The Blvd, Sydney – $235 million; Australian Technology Park, Sydney – $263 million and Space 207 – $168.5 million.
Get a weekly roundup of the latest news from Commercial Real Estate, delivered straight to your inbox!
