QIC Real Estate has decided to sell its three-tower Central Plaza complex in Brisbane's CBD and it is tipped to break the record, as one of the largest property transactions in Australia.
QIC bought the three Central Plaza assets in two tranches, each being a 50% interest, in 1989 and 2004 for a combined total of $314.2 million.
Located in Brisbane’s golden triangle, the complex’s sale is expected to be the largest transaction in Australia since Deka’s Sydney CBD portfolio sold in 2006 for $879 million.
Central Plaza One, located on the corner of Queen and Creek Streets, was constructed in 1988 and comprises 40,429 sqm. The 45-level Central Plaza One incorporates four basement levels of parking for 260 cars and a five level annexe building.
Major tenants in the complex include law firm Freehills, AAMI, Macquarie Bank, St George Bank and the Australian Taxation Office.
The second tower, Central Plaza Two comprises 32,115 sqm over 29 levels. Situated on the corner of Creek and Eagle Streets, the building includes five levels of basement parking for 224 vehicles.
The third building in the complex, known as Central Plaza Three, is currently under construction at 70-80 Eagle Street, with completion due in November 2008. Central Plaza Three has a net lettable area of 11,474 sqm and incorporates 64 car parks.
QIC’s head of global real estate, Laurie Brindle told Australian Property Journal yesterday that the decision to sell the Central Plaza holding was due to a rebalancing of the Group’s Brisbane CBD portfolio within its national Office Property Fund.
“The continuing strong conditions in Brisbane’s office market have triggered significant growth in QIC’s exposure to Brisbane through its existing projects and those under development,” Brindle said.
“As a consequence, in order to achieve targeted diversification we now need to adjust our Brisbane investment weighting within the QIC Office Property Fund and believe our Central Plaza assets will be highly sought after.”
Each of the buildings, including Central Plaza Three, is fully leased. Central Plaza Three is currently under construction at 70-80 Eagle Street and is expected to be completed in November 2008. The building has been 100% preleased by tenants QSuper and QIC and has a net lettable area of 11,474 sqm.
Joint agents Stephen Conry and John Talbot from Jones Lang LaSalle and Robert Sewell and Bill Tucker from CBRE have been appointed to co-ordinate the international marketing campaign, with expressions of interest closing 16 October 2007.
Brisbane’s CBD office market vacancy rate tightened a further 0.5% in the June half to achieve a record low of 1.2%, according to the latest Property Council of Australia research.
Brindle said QIC remained an active investor and developer in Queensland, which was enjoying strong economic conditions and population growth.
“Our assets include premium retail centres in south-east Queensland in Toowoomba, Robina and Helensvale, both on the Gold Coast and Logan Hyperdome, which are long term investments for the group,” he said.
QIC recently formed a joint venture partnership with Westfield to master-plan an integrated Town Centre at Coomera, incorporating retail, residential, civil facilities and education precincts and secured control of a major town centre site.
Brindle said exposure to different market sectors, geographic locations and economic cycles remained a strong focus for QIC.
“QIC is continuing to diversify its portfolio by investigating acquisition opportunities within Queensland, elsewhere in Australia and internationally,” he said.
“The group’s current portfolio includes international property holdings in the United States, UK and selected Asian markets.”
“In December 2006 QIC bought a 50% share of the Westfield Group’s Merry Hill shopping centre near the UK city of Birmingham for AUD$1.3 billion. This represented the Group’s first direct property investment outside Australia.”
“QIC will continue to seek opportunities within the UK, other European markets, North America and Asia.”
QIC remains active in the Brisbane CBD office market and will retain its long-run exposure target to Brisbane. The Group is currently developing a 10,000 sqm office building at 140 Elizabeth Street, which has been preleased to the Australian Taxation Office.
Australian Property Journal
