Forza snares Sydney office on high yield

Forza is paying $138.14 million for 117 Clarence Street.

Forza Capital is buying an almost fully-let A-grade Sydney office from Investa Property Group.

Forza recently listed an Abbotsford site permit-ready for an 11 level office.

The $138.14 million deal for 117 Clarence Street reflects a high 8.02 per cent net passing yield; 96.5pc of the 12 level, 12,510 square metre investment is leased.

Investa paid Roxy-Pacific and Tong Eng Group, both of Singapore, $81m in 2015, recently spending $5m on a refurbishment.

Roxy Pacific and Tong Eng Group also undertook cosmetic works – though in that case, it was because the City of Sydney denied plans to replace the 1283 sqm block with a taller tower.

Forza, for its fund management arm, will hold the property in an unlisted trust now calling on investors promising an average six per cent annual distribution.

Led by Ashley Wain, Forza – an investor and developer too – has also in recent years snapped up unrenovated offices at 200 Creek St, Brisbane, for $41m, and 399 Lonsdale, Melbourne ($86.8m), to refurbish utilising Clean Energy Finance Corporation loans.

As well, it purchased, in Melbourne’s CBD, the historic Nicholas Building on Swanston St and a homemaker centre and development site, in partnership with Jayland, in the northern suburb of Epping, outlaying $70.25m.

In March, again in the Victorian capital, the group listed for sale a former Carlton & United Breweries car park on the banks of the Yarra River at 38 Grosvenor St, Abbotsford, permit-ready for a 11 level office (story continues below).

117 Clarence Street

Just over two thirds of 117 Clarence St’s income is derived from the state government.

The weighted average lease expiry is 3.6 years. The asset also contains 29 underground car parks.

The deal comes two weeks since Invictus Developments outlaid $52.5m – a staggering drop on the c$80m-plus guide – for 39-41 York St, Sydney, with plans to repurpose it as a hotel. That seller was the Bank of China.

Dexus also recorded discounts of between 15-20pc disposing of Sydney offices at 1 Margaret St and 44 Market.

Cushman & Wakefield with Knight Frank marketed 117 Clarence St.

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Marc Pallisco

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