Growthpoint acquires Canberra office, cashes up

Growthpoint’s new office (shaded) is surrounded by taller buildings.

Altis has offloaded Canberra’s former Penrhyn House after four years.

The six storey office, 2-6 Bowes Street, at the south west corner of Worgon, in Phillip, is trading to Growthpoint for $84.6 million reflecting a five per cent passing yield or 5.3pc fully let return.

The vendor paid Quintessential Equity $58.4m at a 6.6pc fully leased market yield.

The Bowes Street office underwent a major refurbishment in 2016-2017.

That seller picked it up for $14m in 2012, then undertook a c$10m refurbishment, renting nearly 90pc to ACT Health.

Another 940 square metres (or 7.6pc) is occupied by the federal government, including for the COVID response team.

CBRE’s Nic Purdue and Michael Andrews with Colliers’ Paul Powderly and Matthew Winter represented Altis.

Growthpoint now holds $261m of Canberra commercial real estate.

Big site surrounded by taller towers

With 12,376 sqm of lettable area across three interconnected buildings, and 86 basement car parks, 2-6 Bowes St was developed in 1986.

ACT Health has 9.2 years left to run on its lease, at which time it will be presented with the first of two five year options.

The CZ2 Business zoned site, within the Woden Town Centre precinct and in an established health hub, spreads 4366 sqm.

It is surrounded by substantially taller buildings including a 25 level building, part of the Grand Central Towers complex, and 24 storey Lovett Tower student accommodation complex.

Westfield Woden is also in the immediate area.

Investors looking outside Civic, Parliamentary precinct: agent

About nine kilometres south of Capital Hill, Phillip is considered metropolitan Canberra’s geographic centre (story continues below).

Growthpoint recently paid $52 million for a Sydney Olympic Park office.

“The sale of 2-6 Bowes St demonstrates the appeal in Canberra extends beyond Civic and the Parliamentary precinct,” Mr Purdue said.

“The Woden Town Centre is attracting significant government infrastructure spend and recent planning changes have encouraged large-scale mixed-use development that is driving economic activity,” according to the executive.

Mr Andrews added social infrastructure is also being built in the area, including at Canberra Hospital and the new CIT [Canberra Institute of Technology] campus.

“The ongoing story of Canberra’s outperformance driven by a stable occupier market, significant reduction in the overall vacancy rate and exposure to the government sector continues to resonate with investors,” he said.

Revalued, refinanced and cashed up

Also today, Growthpoint announced preliminary external appraisals on 37 of its 56 properties boosted its portfolio value by $256m, or 7.5pc, since June 30.

It additionally refinanced $715m of loan facilities, reducing its average cost of debt by 23 basis points and extending the maturity by 2.6 years.

“Growthpoint has had an active period across the business during the first half of FY22,” managing director Timothy Collyer said.

The valuation uplift, across an office and industrial portfolio, came about from yield compression.

Its refinancing gives the group $150m, via two debt facilities, to fund future acquisitions, he added.

Growthpoint recently invested further into the Dexus Industria REIT, formerly known as APN Industrial REIT.

It also this year paid Charter Hall $52m for 11 Murray Rose Avenue, at Sydney Olympic Park, after selling two buildings in the immediate area to an EG managed fund backed by GIC.

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Marc Pallisco

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