AMP Life has sold its Sydney headquarters for more than AUD430m (€300m).

The Australian life insurer offloaded the asset in Sydney’s Circular Quay to two AMP Capital funds.

The acquisition gives the two funds, AMP Capital Wholesale Office Fund (AWOF) and AMP Capital Diversified Property Fund (ADPF), joint ownership of the 1.1 hectare block. 

The building at 33 Alfred Street was Australia’s first high-rise office block.

In exchange, the AMP Group has committed to a 12-year lease to take up 36,500sqm of space in the planned Quay Quarter Tower of a large-scale redevelopment, the Quay Quarter Sydney(QQS) project, planned by the two funds.

AMP Capital’s global head of real estate, Carmel Hourigan, said the acquisition would simplify the “development pathway” for the Quay Quarter Sydney precinct. 

The project, which will cost more than AUD1bn, will be designed by Danish architects 3XN and is due to be completed in 2021.

“AMP’s commitment to becoming an anchor tenant in the redeveloped Quay Quarter Tower at 50 Bridge Street fits well with detailed discussions we are having with other interested tenants,” Hourigan said.

She described the transaction as an “important milestone” for the QQS project.

Subject to final investor approval, construction is expected to begin in 2018.

AMP Capital has raised AUD1.3bn from domestic and offshore wholesale investors in the past year for funds such as the AMP Capital Diversified Property Fund and AMP Capital Wholesale Office Fund.

While backed predominantly by Australian super funds, offshore institutions from Asia and Europe have also invested in the funds.