Perth syndicator snaps up Salvation Army HQ in Melbourne
Perth-based property syndicator Ascot Capital has struck one of the largest deals in Melbourne’s suburban office market in several years, snapping up the headquarters of the Salvation Army for $54.35 million.
The West Australian developer and investment manager is one of the busier players in the market, steadily scooping up smaller commercial properties for its investor network.
But it has also been involved in some jumbo deals, including its sale of an $800 million commercial property portfolio to GPT and MA Financial four years ago.
Ascot Capital was also behind the $1.5 billion sale of the Jandakot Airport and its logistics hub in Perth to Dexus and the APN Industria REIT in the same year.
Ascot, with the financial backing of Nathan Kirsh’s Kirsh Group, had previously taken control of the 99-year head lease of the suburban airport from the federal government in 2005.
In its latest foray east, the Perth syndicator emerged successful from eight competing bidders – including domestic and interstate syndicators, private family offices and offshore private buyers – for the near 8000-square-metre building at 99 Railway Road, Blackburn. The purchase, from BuildCorp Commercial, was struck on a 6.5 per cent yield.
Completed in 2007, the building is fully leased to the Salvation Army with almost 10 years left to run. JLL agents Tim Carr, Piper Dedrick, Josh Rutman and MingXuan Li brokered the sale.
“This transaction is a significant milestone for the Victorian office market, being the highest valued metropolitan office transaction in 2.5 years,” Carr said.
“The sales campaign clearly demonstrated that active domestic and offshore capital are strong believers in Melbourne’s sustained recovery, evidenced by the eight total bids generated from several buyer cohorts.”
Carr said the current market was throwing up compelling opportunities for buyers “for the right assets that have the right attributes”.
“Income certainty, low capex requirements, confidence in future tenant demand and a clear exit strategy are among the most important drivers for active investors,” he said.
