Castlerock sells Wollongong office for $50.4 million

An artist’s impression showing the building with the extra permitted commercial space.

A “trophy asset” in Wollongong has sold for $50.4 million making it the precinct’s largest office transaction to date.

Melbourne-based investor Castlerock was the vendor.

It paid $43.9 million for 90 Crown Street in September, 2016 – a price also believed to have been a record for a commercial property in the coastal town about 90 kilometres south of the Sydney CBD.

The building traded before that in 2005 for $30.7 million.

On a corner site of 3755 square metres, the seven-level office includes 9172 sqm of lettable area and 160 car basement parks.

Almost 20 per cent of the building is configured as retail space. More than three quarters of the asset’s annual rental income is derived from government occupants including the Department of Human Services and Roads and Maritime Services.

The asset was offered with an approval for the construction of an additional 2036 sqm of gross floor area.

It is selling on a passing yield of 7.75 per cent valuing each square metre of building area at $5493.

Knight Frank’s Ben Mostyn, Tyler Talbot, Dominic Ong and James Mulcar with MMJ’s Geoff Jones and Travis Machan represented Castlerock.

“The ability to add around 1600 sqm of office space and 440 sqm of retail space represents a considerable value-add opportunity to increase the underlying income of the property, expand the tenant offering and reinforce the property’s position as Wollongong’s undisputed trophy asset,” Mr Machan told the Illawarra Mercury in this item when 90 Crown Street was listed for sale in October.

Mr Mostyn said the sale price of $50.4 million makes the deal Wollongong’s largest to date for an office.

The agents closed an expressions of interest campaign on November 22, 2018.

An aerial image of 90 Crown Street, Wollongong.

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Marc Pallisco

Marc Pallisco

A freelance property writer and analyst, Marc is a co-founder of realestatesource.com.au.

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