A newcomer Hong Kong-based Chinese investor has scooped up an office tower at 75 Miller Street for $52 million.
The sellers, Property Bank Australia and Security Capital Corporation, put the 12-level property on the market in September with expectations of about $50 million. They last purchased the building in 2011 for $22.25 million.
It was sold on a net yield of 5 per cent, and a land rate of $10,500 a square metre, a record for B-grade buildings in North Sydney.
It is understood the new owner will be holding the property as a long-term investment with hopes for rental growth. The landholding is 777 square metres.
Situated walking distance from the train station, the building returns a fully leased annual rent income of $2.9 million.
It has multiple subdivision options and benefits from value uplift. It sits next to the new retail centre at 50 Miller Street.
Scarcity of office space
This is the third North Sydney office building Property Bank Australia and Security Capital Corporation have sold in the past six months. They sold 8 West Street and 116 Miller Street with RG Capital for $60 million and $135 million respectively in July.
Property Bank on its own also sold the inner-city office building at 39-47 Regent Street in Chippendale leased to ASX-listed Navitas Limited for about $38 million in June.
Many investors have flocked to North Sydney to capitalise on the scarcity of office space as a result of office tenant displacements from metro train development.
Building owners are taking advantage of the current conditions to put their buildings on the market. Chinese-backed local group Aqualand is selling its property at 54 Miller Street.
Knight Frank’s Tyler Talbot and Dominic Ong and CI Australia’s Bevan Kenny and Chris Veitch brokered the deal on 75 Miller Street.