Dexus offloads Sydney office after 36 years

Dexus spent $18 million renovating 44 Market Street in 2019.

Hong Kong based asset manager Pacific Alliance Group is paying $393.1 million for Sydney’s 44 Market Street.

The 26 level office was one of two in the city recently listed by Dexus.

The other, 1 Margaret St, is selling to Melbourne based Quintessential Equity for close to $300m.

The average floorplate of 44 Market Street is 1000 square metres.

Dexus will tip part of the proceeds into its development pipeline including the Atlassian headquarters, near Central station.

44 Market Street

Developed in 1978 and renovated four years ago, 44 Market St contains 30,694 square metres of A-grade space, about 85 per cent of which is occupied; tenants include the Australian Bureau of Statistics, Commonwealth Bank of Australia, Slater and Gordon and Westpac.

Dexus acquired it in parts – a 70pc stake cost $78m in 1987 while the balance set it back $31m eight years later.

It is taking a hit on the sale – the office was last year valued at $475m and before that, at over $500m.

The group is also believed to be accepting a similar (15pc) discount on 1 Margaret St, which was last appraised at $350m (story continues below).

Quintessential is buying 1 Margaret Street off Dexus.

CBRE and Colliers brokered that deal.

PAG sold a half stake in 60 Margaret Street in 2018.

Knight Frank and JLL are marketing 44 Market St.

PAG invests again

PAG manages about $US50 billion in assets on behalf of nearly 300 institutional fund investors.

As well as real estate, it lends, and invests in private equity; in Australia, last September, it acquired Patties Foods and Vesco while in 2021, it snapped up Unispace.

In 2018, the manager sold a half stake in 60 Margaret St and the MetCentre for $420m – a significant rise on the $300m it paid MTAA three years earlier.

Coincidentally that buyer, Blackstone, with the other owner, Mirvac, this month offloaded it to AsheMorgan and Mitsubishi Real Estate, for c$820m.

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Marc Pallisco

A former property analyst and print journalist, Marc is the publisher of