RG buys historic Fortitude Valley offices

The office was renovated last year.

Fortitude Valley’s historic Keating’s Bread factory – now three offices divided by car parks and gardens – has sold for $15.8 million.

The deal reflects an 8.9 per cent market yield.

Hassell is an occupier. The annual net market net rent is c$1.4 million.

It also marks a Brisbane reweighting for purchaser RG Property which last March sold a CBD office for $53.5m after nine years.

Eight months ago the asset manager offloaded a modern Woolworths-backed investment near Melbourne’s Dandenong for $29.1m.

Site history

The Fortitude Valley complex, 37 Kennigo Street, was built in 1916 by Thomas Keating and is partially heritage listed.

The bread shop owner sold it in 1948 to shipping company Burns Philp – which kept the bakehouse for its own use and retained the balance as a retail investment, according to the Queensland Heritage Council listing. It also has stables.

In 1952 the property sold to department store Penneys which occupied for 20 years.

It was then a research centre and in 1993 acquired by the Catholic Church’s Society’s St Vincent de Paul, which used it until 2007 (story continues below).

It was refurbished as contemporary offices in 2008, 2017 and last year – all up the buildings offer 2955 square metres; architect group Hassell is the anchor.

There are also 46 car parks.

The site spread 5094 sqm, fronts two streets and has development upside.

Valuable airspace

“We’re excited by the medium and long term potential of this asset as the Fortitude Valley region continues to go from strength,” RG Property chief executive officer Rhett Williams said.

“Securing this large landholding puts us and our investors in a strong position to capitalize on the continued growth in the Fortitude Valley market, which is emerging as a natural extension of the Brisbane CBD”.

CBRE’s Jack Morrison and Peter Chapple with Cushman & Wakefield’s Peter Court and Mike Walsh were the agents.

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Marc Pallisco

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