DWS has sold a A$119m (€72m) Brisbane office tower to local fund manager Clarence Property, incurring a A$24m loss on the seven-year investment.
The Queensland firm is holding the asset at 120 Edward Street in its flagship Clarence Property Diversified Fund, which currently manages a portfolio of A$800m.
The asset is the single-largest yet acquired by the fund, which was set up 30 years ago and owns assets in regional cities.
Simon Kennedy, Clarence Property’s CEO, told IPE Real Assets: “We are long-term investors of income-producing assets. This building is fully leased, and it underwent big capital expenditure programmes over the last few years, so we really hit the ground running.
“A good upside is the potential to revise rents to match the market rate. The average rent in the building is A$725 per sqm, compared to the market rent of A$800-plus per sqm.”
Kennedy said the property has been “acquired at well below replacement cost and the resilience we have seen in Brisbane in recent years positions it as one of the standout office markets nationally”.
The latest sale has reinforced Brisbane’s claim to being one of the most keenly sought-after office market in Australia, which has chalked up more sales, in numbers, than either Melbourne or Sydney post-COVID-19. Sellers, led by Charter Hall, and including Credit Suisse, have sold more than A$650m in the past year or so.
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