GIC has withdrawn the sale of a half-stake in a AUD1.8bn (€1.16bn) Australian office tower, blaming “increasing uncertainty” in the property market.

As reported in August, the Singapore sovereign wealth fund appointed agencies to market the Chifley Tower, one of Sydney’s most identifiable landmarks.

A GIC spokesperson said today that GIC will not be proceeding with the sale of Chifley Tower and Plaza.

“Given increasing uncertainty in the macro environment and the general real estate market, the bids received did not reflect the asset’s intrinsic value as a premium office building in the heart of Sydney’s CBD.”

Agents have suggested that a complication to a transaction was the status of the freehold lease, on which the office tower is sited. The lease runs out in June 2113.

It was reported that GIC might have decided to delay the sale until the future of the freehold lease was ascertained.

Parties, including Charter Hall, are reportedly keen to buy the freehold, which carries an asking price of AUD100m.

GIC bought Chifley Tower jointly with Morgan Stanley Real Estate Investing (MSREI) in 2005 for about AUD710m. GIC has since bought out MSREI to become sole owner of the building.