Australian diversified property group Mirvac has secured its second capital partner in as many months following a AUD414m (€281m) deal with the Singapore-based Suntec REIT.

Mirvac signed a deal worth $140m (€120m) with Morgan Stanley last month.

Suntec REIT is managed by ARA Asset Management, one of Asia’s largest REIT managers. ARA, which manages SGD36bn (€23bn) in assets, advised Suntec REIT on the transaction.

Suntec REIT currently owns a number of Australian assets, including a premium, newly-developed office tower in North Sydney, which it purchased for AUD413m in 2013.

It has agreed to buy a 50% stake in what is known as the Olderfleet office development, in Melbourne’s central business district, from Mirvac.

Under the purchase agreement, Suntec REIT will fund its 50% interest in the completed development via a fund-through agreement during the construction period.

In return, Mirvac will provide a five-year rental guarantee on any unlet office space from the date of practical completion. Construction began in May this year and is expected to be complete in 2020.

Mirvac has secured the international accounting firm Deloitte as anchor tenant. Deloitte will occupy 12 floors, covering 22,000sqm for 12 years, starting in the second half of 2020. The building is currently 40% pre-leased.

Mirvac will provide development management and ongoing property and investment management services for the asset. 

Located in the heart of Melbourne’s financial district and rising from the unique 1880s facades of the Olderfleet Buildings, 477 Collins Street will provide more than 56,000sqm of office space over 40 levels.

The deal was struck at 4.8%, setting yet another benchmark for office buildings in the city.

Commenting on the sale, Mirvac’s CEO and managing director Susan Lloyd-Hurwitz said she was pleased to have “another high-quality capital partner” to co-invest in the group’s development projects.

The deal came after Mirvac in June this year successfully sold a 50% stake in a nearby Melbourne project, at 664 Collins Street, to Morgan Stanley’s Prime Property Fund Asia, an open-ended core fund, for AUD138m at a 4.97% cap rate.

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