Castlerock, Corval trade government backed office
Castlerock has quietly snapped up a modern Perth office anchored to two state government departments.
The seven level building, Workzone East, at 1 Nash Street, set it back $79.4 million.
Corval Partners Limited was the seller.
It paid c$68m in 2017.
Charter Hall was that vendor.
It also developed the office in 2013.
For open-ended government focused fund
With 12,360 square metres of A-grade area and 81 car parks, 1 Nash St is fully tenanted to two state departments: Primary Industry and Regional Development and the Mental Health Commission.
The NABERS Energy rating is 6-star. The water score is 4.5-star.
“The asset will, upon settlement, form part of the Castlerock Government Property Fund, which now holds 15 regional, suburban and CBD assets spread across six states and territories,” the buyer said in a statement.
Launched in 2014 it now manages real estate worth nearly $700m.
Ninety nine per cent of the portfolio is leased (continues below).
Ninety six pc of revenue comes from the state or commonwealth government.
The weighted average lease expiry is 5.5 years.
“The proposed acquisition dovetails with the fund’s strategy of developing and buying government leased assets that are well positioned for long term performance,” Castlerock chief executive officer, Adam Bronts, said.
“When we acquire or develop assets leased to state and commonwealth governments, we see them as long-term partnerships with the occupying agencies or departments,” he added.
“We work closely with them to identify and provide their long-term real estate needs, which, in turn, produces long-term, stable returns for our investors,” according to the executive.
“It’s a formula that allows Castlerock to meet its key objectives – delivering strong returns to investors, ensuring positive experiences for tenants, and forging meaningful relationships in the communities where we operate”.
Oliver Picone added the sale reflects the successful execution of Corval Limited’s active asset management strategy.
“Since acquiring Workzone East, our focus has been on improving the quality, resilience and long-term value of the asset,” he said.
Cushman & Wakefield’s Nick Charlton brokered the off-market deal.
“The result reflects growing investor demand for quality Perth office assets supported by secure income and improving market fundamentals,” according to the executive.
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