Australian Unity has purchased Beenleigh’s first major commercial building since 2011.
Due for completion next month, the seven storey investment – The York, at 96-98 York Street – contains 4009 square metres of A-grade office area, all of which is pre-committed to the Logan City Council for 10 years with two five year options.
It also includes 174 sqm of ground level retail space – linking the main entrance to John Lane via a pedestrian only laneway.
Four SOHO apartments are contained in another 478 sqm.
There is also a double storey car park with 50 bays (33 of which are leased to the office tenant).
Adler Constructions and investLogan are the vendors.
Beenleigh is about 34 kilometres south east of Brisbane.
Another asset for AOF
Australian Unity Investment Real Estate Limited is paying $33.52m for The York – a price which reflects a 5.75 per cent capitalisation rate.
The asset will be held by the Australian Unity Office Fund.
“The acquisition supports AOF’s refined strategy of owning commercial real estate that aligns with the key asset attributes of affordability, accessibility and amenity,” fund manager Nikki Panagopoulos said.
“In undertaking this acquisition, we have been able to recycle capital from the sale of 241 Adelaide St, Brisbane, an ageing leasehold asset requiring significant capital expenditure into…a brand new purpose-built freehold building that provides long term income certainty with minimal capital expenditure requirements and sustainable initiatives,” she added.
“Management will continue to execute on its active asset management strategies, including refurbishments and developments while assessing further capital recycling opportunities,” according to the executive.
“These opportunities will be investigated in parallel with the assessment of the proposed merger with the Australian Unity Diversified Property Fund”.
The Beenleigh office is scheduled for settlement in December.
It will be funded with existing debt facilities.
Construction of 96-98 York St started last May – a month after a permit was granted (story continues below).
The Conrad Gargett designed building includes a façade with cascading greenery and wintergardens.
Its footprint extends beyond the property boundary at both street frontages.
“The sale of The York cemented Beenleigh as a key commercial hub for the district,” Alder Developments general manager Greg Tupicoff said.
“As an A-grade commercial tower, The York is the first of its kind for Beenleigh and will act as a signpost in the suburb’s growth as a prosperous and well-positioned business hub and commercial landmark between Brisbane and the Gold Coast,” he added.
“The very nature of this project’s unique design encourages business diversity and will in turn foster a thriving commercial landscape where the local economy will be encouraged to grow,” according to the executive.
investLogan Chair Steve Greenwood said The York was purpose-built to drive economic growth within Logan’s key business centres and the sale signified the next stage in Beenleigh’s evolution.
“This project provides a rare fusion of commercial, retail, and residential opportunities and will be instrumental in the revitalisation of the Beenleigh business community by creating a vibrant commercial precinct designed for local business to prosper” he added.
The City of Logan lease allows for annual rent increases of greater than three per cent, or CPI.
Significant growth planned
The land previously accommodated a 37-bay open-air car park.
Within a government hub, it is walking distance to offices occupied by the Department of Resources and Department of Corrective Services, Magistrates Court, Dauth Park and Beenleigh train station.
“The asset is located in…an affordable south-east location in Queensland with significant growth opportunity and improved transportation planned,” an AU statement added.
“Beenleigh is one of Logan City Council’s preferred hubs for government services,” it added.
“The commercial centre of Beenleigh [where 96-98 York St is located] has continued to attract A-grade commercial office tenants, with sustainable income growth expected over the medium to long term,” according to the group.
“The broader Logan area is fast becoming a core metropolitan market that is expected to experience significant population and economic growth over the next 15 years and is forecast to outperform Brisbane, Moreton Bay and Redland Bay as the second fastest growing region in South East Queensland”.
“This government endorsement of the location continues to move the Beenleigh precinct forward, driving foot traffic with more than 250 staff expected to work in the dedicated office space. A huge benefit to the retail tenants located within the project,” Mr Morrison said.
“The York builds on the overall aims of the Beenleigh Town Centre Master Plan and includes outcomes from the Beenleigh Summit from 2017 – an initiative that focused on unlocking the economic potential of Beenleigh,” he added.