Mirvac, M&G snare EY HQ stake

The EY Centre is worth $1.16 billion.

Mirvac, in partnership with M&G Real Estate, is spending $578.5 million for a half share of Sydney’s EY Centre.

The deal with AMP, which held it for the Capital Wholesale Fund, is the priciest for an office in the New South Wales capital this year.

It also reflects an 12 per cent premium to the June 30 book value.

The capitalisation rate is 4.1pc.

Mirvac Property Trust owns the other half of the asset, 200 George Street, which it developed with AMP and EY in 2016.

Mirvac trumps Lendlease

Mirvac exercised its Right of First Refusal to buy the balance of the building; AMP had been negotiating to sell it to Lendlease – for c$575m.

Over 33 levels, the office contains 38,650 sqm of Premium grade area.

AGL Energy also occupies a space (story continues below).

The complex is Mirvac’s national headquarters too.

The Weighted Average Lease Expiry by income is 5.8 years.

“At a significant premium to book value, the sale of 200 George St is a fabulous result for the fund and its investors and demonstrates the continued strong appetite for prime CBD office assets,” AMP Capital Wholesale Office Fund manager Kit Georgeos said.

Interest came from both domestic and offshore investors, she added; Allianz, Blackstone, GIC, Keppel REIT, LinkREIT and Nuveen Real Estate are reported to be amongst the other underbidders.

Settlement is scheduled later this year at which time Mirvac will take over the asset’s management.

Proceeds will be recycled into near-term capital commitments.

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Marc Pallisco

A former property analyst and print journalist, Marc is the publisher of realestatesource.com.au.