St Leonards office stake switches between Centuria funds
Centuria, on behalf of its Office REIT (COF), is paying $68 million for the half-share of a St Leonards office that trust didn’t own.
The interest was held by the Centuria 203 Pacific Highway Fund.
The manager paid $86.1m for the whole property in 2015.
That deal reflected an eight per cent initial yield.
The capitalisation rate for the COF transfer is 5.75pc.
203 Pacific Highway, St Leonards
Part of the 21-year old mixed-use Forum complex, the asset, 203 Pacific Hwy, is located over the St Leonards railway station; a leasehold with the State Rail Authority expires in 2088.
The building contains 11,735 square metres over 11 floors. Just 0.7pc is vacant. The Weighted Average Lease Expiry is 3.9 years.
There are also 150 car parks (story continues below).
COF also owns the adjoining office, 201 Pacific Hwy.
101 Moray Street, South Melbourne
In an ASX announcement today, Centuria also confirmed the purchase of a South Melbourne office – 101 Moray Street – for $205.1m, reflecting a five pc return (read our story on that deal here).
COF will hold this property too.
Following settlement of both assets – expected to take place this week – the portfolio’s average building age reduces from 16.8 years to 15.
The trust’s WALE increases slightly, from 4.3 yrs to 4.5.
To partially fund the latest acquisitions, the manager has launched a $201m capital raising being managed by MA Moelis and Morgan Stanley.
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