JP Morgan Chase to part with half or all of Southbank’s Twenty8 Freshwater Place

The 25 story office contains 34,000 square metres of lettable area.

JP Morgan Chase is selling a modern Southbank office.

The vendor can expect more than $400 million for the 25-level, A-grade commercial building known as Twenty8 Freshwater Place.

It paid Frasers Property Australia and GPT Wholesale Fund $286 million four years ago.

FPA and GPT spent $115 million in 2007 on the then-new Southbank asset.

With 34,000 square metres of lettable area, the building recently underwent a multi-million dollar to its end-of-trip facilities.

JLL’s Leigh Melbourne and Nick Rathgeber, two of the agents who sold the office to JP Morgan Chase, have the listing again.

The vendor will also consider selling a 50 per cent stake.

Twenty8 Freshwater Place was put up for sale on the same day as the vendor put a For Sale board out of the St Collins Lane shopping centre, at 260 Collins Street, in the city.

Acquired in 2016 for $247 million, that fully renovated six storey asset once known as Australia on Collins is expected to sell for more than $150 million this time around – a reflection of its high vacancy rate and bleak retail economic backdrop.

Twenty8 Freshwater could sell on five per cent yield: agents

PricewaterhouseCoopers, one of 28 Freshwater Place’s first occupiers, was speculated to have made the surprise decision to vacate the Melbourne CBD for Southbank because of – amongst other reasons – anticipated travel time and cost savings especially to access the airport which it and its clients used a lot.

The Southbank office is as close to Flinders Street train station as many Collins Street workplaces. It is also walking distance to Southern Cross.

Blue chip tenants based at Twenty8 Freshwater include CPA, MMG Australia and WSP Australia.

“Tenant retention is an attribute of both Twenty8 Freshwater Place and the Southbank precinct,” Mr Melbourne said. “It is arguably the most vibrant and accessible location in Melbourne and once tenants experience the building and the precinct it is very difficult for them to leave.”

Mr Rathgeber added he expects the asset to achieve a cap rate of as low as five per cent – a reflection of “the shortage of existing prime office assets in the Melbourne market”.

There was (a lower-than-average) six Melbourne CBD office investment transactions worth more than $100 million last year, the agents said.

Just two were sold via a public process.

An office tenancy at Freshwater Place, used for the 2016 marketing campaign.

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Marc Pallisco

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