AMP Capital and HB+B Property have divested a Chippendale office for an impressive capital gain.
At 55-59 Regent Street, the four storey investment is selling for $59.5 million – reflecting a 3.1 per cent yield – to MKH Properties, owned by Malaysia’s Mah family.
The sellers paid $37m in late 2020 then refurbished.
The property was previously the subject of a 91-key hotel conversion.
AMP and HB+B are speculated to have recently picked up a 3000 square metre office with development upside at nearby 86-90 Bay St, Ultimo, opposite the Broadway Shopping Centre.
55-59 Regent Street
JLL’s Mitch Noonan and James Aroney marketed 55-59 Regent St, on 911 sqm, with 10 car parks.
The bulk (88pc) of the 2931 sqm lettable area is tenanted to the Institute of Creative Arts until 2029.
“Together with the procurement of the head lease, the sale of the asset in the current economic climate is a pleasing result for HB+B and its JV partner,” HB+B development manager, Chris Lykoudis, said.
AMP fund manager, Tim Fallet, added “while it’s been good to realise value following the recent refurb and re-lease of the property, we continue to be big believers in the precinct and have recently acquired another office property in the area with significant development plans on behalf of the same capital partner (story continues below).
The Chippendale asset fronts both Central station and Dexus and Frasers Property Australia’s recently approved Central Place precinct.
Atlassian’s 40 storey headquarters is under construction in the pocket too.
“The city fringe has remained a resilient investment destination for both private and institutional capital, which is being supported by major infrastructure and a strong occupier market with nearly [no] vacancy across prime assets in the core City Fringe precinct,” Mr Aroney said.
Elsewhere in the area, Canva is speculated to be paying over $120m for an unrenovated, vacant office on Kippax St, Surry Hills, to occupy.
Also in that suburb, Toga Group recently outlaid $6m for a c1880 ex-church opposite its $400m Surry Hills Village development.
Karbon Property’s Tom Williams and James McCourt brokered the Bay St, Ultimo, deal, but declined to comment.
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