The Macquarie Office Trust has continued to record strong leasing in its United States and Australian property portfolio.
The first quarter of 2006 saw MOF completed its $A1.6 billion joint venture with Maguire Property Group.
In Australian, the trust recorded several major leases, a total of 27,778 sqm of space was leased with Heads of Agreement in place over a further 13,026 sqm.
In March, Caltex signed a 10-year lease over 9,200 sqm at 2 Market Street in Sydney.
In addition, Transurban has agreed on a 10-year lease for 6,453 sqm of space at 505 Little Collins Street in Melbourne.
MOF’s chief executive Simon Jones said the Transurban lease was a significant leasing achievement.
“Securing a long term lease with a high calibre customer over a substantial portion of the building ahead of the current lease expiries is a very pleasing result,” he added.
Following completion of this deal with Transurban, new leasing and renewals completed during the quarter have seen the Australian portfolio maintain its high occupancy level at 96%.
Rent reviews finalised in the March quarter on the Australian portfolio have increased annual income by $1.31 million, representing on average a 4.0% increase.
Meanwhile in the US, the trust secured over 162,251 sq ft of lease new leases with a further 57,963 sq ft under HOA, increasing the US portfolio’s occupancy to 95%.
Rent reviews completed across the US portfolio over the quarter have produced a 4% increase in rents, adding $US1.25 million to property income each year.
In other news, over the period the trust secured a refinancing facility of $US116 million on Chase Tower, Indianapolis.
This was negotiated on superior terms and will produce an annualised saving of $US570,400 for the trust on its pre-existing facilities.
“We are delighted to welcome two large tenants, Caltex and Transurban to the portfolio on long term leases.
“The closing of the Maguire transaction is a milestone in the evolution of the trust and has positioned the portfolio for improved future income growth,” he added.
MOF reported a March quarter distribution of 2.82 cents per unit, paid during April 2006, is 2.5% above the prior corresponding quarter.
By Nelson Yap
Australian Portfolio:
Property | Comment |
505 Little Collins Street, Melbourne | Completed a lease to Transurban for levels 1 – 4 comprising 6,453 sqm from third quarter 2006 for 10 years with fixed 3.5% annual increases. |
2 Market Street, Sydney | Caltex signed a 10 year lease over 9,200 sqm across five high rise floors in the existing office building with fixed annual 4% increases. This follows the 15 year lease to Fitness First over 2,000 sqm on the ground floor of the new building. |
2 Park Street, Sydney | Australian Worldwide Aviation Services Pty Ltd (AWAS) has renewed its existing lease on level 19 (1,793 sqm), signing a 10 year lease starting from July 2006 with 4% fixed annual increases. Regus has renewed its lease for part of its premises on level 39 (1,840 sqm). The new 8 year lease commences August 14, 2006 and includes 4% fixed annual increases. |
Railway Parade, Burwood | Building occupancy has increased to 77% after NSW Government signed a six year lease over level 3. |
Charter Grove, St Leonards | Vast Systems has leased 860 sqm on the ground floor from March 2006 for five years with fixed 3.5% annual increases. |
Naylor House, Adelaide | The South Australian Motor Sport Board and Excom Education Pty Ltd have leased the remaining ground floor areas for seven and five years respectively. The deals total 958 sqm and take building occupancy to 100%. |
US Portfolio
Property | Comment |
10 & 30 South Wacker Drive, Chicago | A total of 54,810 sq ft has been leased during the quarter, with an additional 20,586 sq ft under HOA, increasing the property occupancy to above 90% Navigant Consulting has expanded by 26,631 sq ft on the 33rd floor of 30 South Wacker. The 10 year lease commences in June 2007 and includes 3% annual fixed increases. |
San Diego Tech Center, San Diego | Combined Conditional Access Development (CCAD), an entity of Motorola, has committed to a 7 year lease over 24,981 sq ft, commencing July 2006 with 3% annual fixed increases. This lease was previously included in December 2005 HOA. |
One Liberty Square, Boston | Building occupancy has increased to 95% (including HOA) after new leases during the quarter totalled 3,658 sq ft and HOA totalled 8,091 sq ft. |
Sun Trust Center, Orlando | Presidion Solutions has signed for 5.5 years over 14,767 sq ft, starting May 2006. |
Wachovia Financial Center, Miami | Leases totalling 25,520 sq ft have been completed over the quarter with an additional 9,990 sq ft under HOA, taking building occupancy to 94% . |
