Government sells CBD building with development restriction
The owner of landmark skyscraper 101 Collins Street has sold a low rise building behind it after adding a covenant restricting airspace development.
Commonwealth Superannuation Corporation, which manages federal public servant pensions, is making a paper loss from the c$14.8 million deal for 107-109 Flinders Lane, to ex-General Practitioner, prominent property investor, Harry Chua.
It paid $15m in 2015.
The vendor will however recover a windfall in the form of higher rents from the view security it can offer 101 Collins tenants – in this direction over the Yarra River to Southbank – even on the lowest floors.
CSC shaping neighbourhood
101 Collins St commands amongst the highest rents in the city – over $1000 per square metre, per annum.
CSC – and ex-owners – have form buying properties around it to prevent airspace development.
Some have required it to dig deep – including 45 Exhibition St, an office on 344 sqm, which cost $27.5m in 2019.
Other properties have come relatively cheaper including this year, 63 Exhibition St, on 894 sqm, for $45m.
CSC also owns strata suites within an office at 55 Exhibition St, potentially allowing it to block a redevelopment proposal by other owners.
In 2002, owners sold the Golden State Hotel, then known as Rosati’s, for $4.3m after paying $5.5m six years earlier then capping the development upside.
CSC bought 107-109 Flinders Ln, with 1568 sqm over six floors, from architect Philip Cox which not earlier obtained a permit for a 43 level ‘super thin’ tower.
JLL’s Josh Rutman, Piper Dedrick and Nick MacFie brokered the onsale.
Mr Chua, who also owns the Citiclub Hotel, ACA Building and 123 and 126 Queen St, is able to entertain a variety of development outcomes – including an immediate strata sell-down.
The ground floor and basement are tenanted. The upper levels need to be fit out.
Subscribe to our free newsletter at the bottom of this page.
