Centuria Capital Group has bought an office tower in South Australia for AUD184.6m (€118.6m) from Blackstone.
Centuria will own half of 80 Grenfell Street, with its capital partner the Australian investment firm, the Lederer Group, owning the remaining half.
The office tower is 96% leased to a regional bank until 2025, with an option for a further 5 years.
Blackstone bought the building, 80 Grenfell Street, as part of its AUD400m purchase of Rundle Mall shopping centre in late 2015.
Jason Huljich, Centuria’s head of real estate and funds management, told IPE Real Assets that Centuria accepted a yield of 6.6%.
Although considered tight for Adelaide, he said it is better than the 4-4.5% being paid for similar high-quality prime buildings in Sydney.
John McBain, Centuria’s Group CEO, said: “Adelaide is enjoying strong economic growth, fuelled by a pipeline of large infrastructure projects and recent stamp duty reductions.”
Centuria, which counts the likes of Blackrock as co-investors, has previously partnered with Lederer, in the acquisition of another asset, 201 Pacific Highway, North Sydney, for AUD171m earlier this month.
Huljich said Centuria will hold its share of the office tower in a single-asset unlisted vehicle, to be launched later this month.
Centuria has been active in the market this financial year, having acquired some AUD700m of assets.
The group is in ongoing discussions with its single largest shareholder, the Warburg Pincus-backed ESR, on strategy over a mutual target, Propertylink.