Fund managers list similar offices with very different price hopes
After a mooted deal earlier this year fell through, Australian Unity has listed a major Melbourne asset – the final part of a plan to wind down and delist the Office Fund (AOF).
The 13 level building on 2350 square metres at 468 St Kilda Road (pictured, top), about five kilometres south of the CBD, was valued at $62 million, assuming a 7.25 per cent capitalisation rate, in reporting last month.
The improvement contains 11,210 sqm of B-grade space – 74.5pc of which is occupied, with a weighted average lease expiry of 3.4 years.
Any new structure could be bigger – c18,000 sqm, according to the marketing agents.
Configured as residential – this could yield c150 dwellings plus amenity like a gym, sauna and pool.
“This forever institutionally owned building features one of the most sought after and flexible floor plates in the precinct,” Knight Frank’s Ben Schubert, who is representing Australian Unity with Trent Preece, said.
“Leased to the anchor with a 2.5 year lease expiry, the building is positioned to capitalise on the opening of the Anzac Station and flight-to-quality to the northern end of the CBD,” he added.
The listing comes a month since the AOF shed a Canberra office, 64 Northbourne Avenue, for $21.2m – a major drop on the ($29.5m) December, 2023, book value.
Last financial year, it offloaded the trust’s balance assets – 2-10 Valentine Avenue in Parramatta, for $80.5m – against a $95m book value (and $149.5m appraisal in late 2021), and in Brisbane, 150 Charlotte St in the CBD, for $61.5m, and in suburban Beenleigh, for $29.7m – a loss on its 2021 outlay (story continues below).
abrdn to shed #432
Meanwhile, Edinburgh-based fund manager abrdn has listed 432 St Kilda Rd with $35m-plus price hopes.
On 2327 sqm – also in the pricier northern end of the strip – it rises 13 floors with 9128 sqm of renovated area, part of which is vacant.
If it weren’t, the asset could return $4.4m per annum, JLL marketing agents, Paul Kempton, Josh Rutman, Piper Dedrick and Tim Carr, said.
Occupying a relatively smaller footprint than its neighbours and with a 1-star NABERs rating, the improvement could also be replaced with something bigger and more efficient.
Abrdn, formerly known here as Standard Life, Aberdeen Asset Management then Standard Life Aberdeen, paid Yak Yong Quek, founder of Prime Value and Shakespeare Property, $41.6m in 2014.
According to the Property Council of Australia’s August, 2024, Office Market Report, St Kilda Rd carries one of the country’s highest vacancy rates, at 27pc.
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