Receiver puts $100m St Kilda Road properties on market
A $100 million plus portfolio of St KIlda Road buildings, owned by Singapore’s International Healthway Corporation but now in receivership, will hit the market next week with their leasing profile improved.
As revealed by The Australian Financial Review, KordaMentha were appointed to the two St Kilda Road properties in dramatic circumstances in late August, at the direction of Westpac, which holds the senior debt.
Real estate investor Qualitas, the Schwartz family-backed private equity firm, holds mezzanine debt in the two properties.
A third IHC-owned property, Geelong Medical Centre, is under the control of receivers at KPMG, through the National Australia Bank.
The St Kilda Road assets are well known. The eight-storey building at 541 St Kilda Road comprises more than 8,000 square metres and is almost entirely occupied by Seek.
With the $40 million-plus building in receivership, the online recruitment firm has recently exercised an option on its tenancy, extending it another four years to late 2021.
KordaMentha has also appointed JLL’s Robert Anderson, Langton McHarg and Alex McColl to handle the properties, which can be sold together or separately.
The second property, a $60 million plus tower at 553 St Kilda Rd, is the home of the US consulate in Melbourne.
The leasing profile at the seven-storey, 10,000sq m building improved considerably in August when Monash University committed to taking around 8,000sq m on a 10-year lease.
Both properties were acquired by the Singapore-listed medical centre landlord in separate deals in 2014. It purchased 553 St Kilda Road for $45 million and 541 St Kilda Road for $35.75 million.
The Singaporean landlord considered putting both towers on the market last year. That idea was abandoned and the two assets were to join the third, the Geelong clinic, in a real estate investment trust.
This year both St Kilda assets were back in play, with private investor Vantage Property and retail king Solomon Lew understood to be circling each of them.
But corporate turmoil back in Singapore struck before any deals could be finalised. In Singapore, IHC is embroiled in a dispute with Crest Capital Asia, whose receivers placed, then withdrew, caveats on the Australian properties.
Those actions had alarmed the Australian banks, according to IHC company filings, and also made it difficult to execute sales of the St Kilda Road properties that were being negotiated. The mooted deals for the two assets were worth $104.25 million, IHC said.
