Blackstone has put its 50% share in an office block in Sydney up for sale for at least AUD800m on (€521m).

If Westpace Place is sold for more than the asking price, Blackstone would have doubled its money in four years.

A source confirmed to IPE Real Assets that Blackstone will sell its stake in Westpac Place and marketing will commence from January 29.

The source said Blackstone has commissioned JLL and Savills to handle the sale.

Industry sources said the value of the building has soared on the back of strong interest from offshore and domestic investors in prime offices in Australian capital cities.

Westpac Place at Kent Street, is located on the southern fringe of the traditional financial heart of Sydney central business district, has benefitted from its close proximity to the newly-completed Barangaroo, Sydney’s newest commercial hub.

The value of Westpac Place has also appreciated following the decision by Westpac, one of Australia’s Big Four banks, to extend its lease for a further 12 years.

Westpac Bank currently occupies the whole building, which has 77,000sqm lettable space. The new lease will extend its tenancy to 2030.

Blackstone acquired the stake in the office complex from the listed Mirvac Group for AUD435m in 2014.

It was part of a two-tranche deal including call options over a portfolio of seven non-core office and retail assets in NSW, Victoria and Queensland, for AUD391.4m.

Mirvac provided vendor finance of AUD156m as part of the two deals, which totalled AUD826.4m.

Market observers said Blackstone’s decision to sell Westpac Place may have been motivated by the strong demand for 1 Castleraegh Street in Sydney central business district last November.

The US giant sold the building to the Hong Kong-based entrepreneur Francis Choi for AUD220m.

In 2014, Blackstone bought 1 Castleraegh Street from Mirvac for AUD69.4m, as part of a portfolio sale.

 

Topics

Related Companies