After months of speculation, Suncorp has announced it will take close to 40,000sq m in Mirvac’s $800 million 80 Ann Street Brisbane CBD tower, marking the largest leasing deal in more than a decade.
In an ASX announcement on Monday, Mirvac said that it has entered into an agreement to sell 50 per cent of the tower to British fund manager M&G Property’s Asian property fund.
The deal, worth $418 million on a 5 per cent cap rate, will see M&G fund 50 per cent of the construction and development costs of the tower.
Now that a major tenant has been secured, Mirvac has exercised a put-and-call option with Singaporean developer Wee Hur for $79 million for the 5,500sq m site. Wee Hur had previously received a permit for a 36-storey student accommodation tower on the site.
The Suncorp lease was fiercely sought-after, with Mirvac beating out Charter Hall and Investa’s 360 Queen Street and ISPT’s Regent Tower for the lease.
Suncorp will take up 66 per cent of the tower – 39,600sq m – for a 10-year term and move into its new Brisbane location by September 2022.
The 80 Ann Street tower will offer 72,540sq m of office space with 1,500sq m floorplates; Mirvac lodged an development application for the Woods Bagot-designed office tower in February.
The move will consolidate Suncorp’s Brisbane workforce into a single office space, following on from similar office consolidation projects the bank has carried out in Sydney, Auckland and Melbourne.
“It will provide the flexibility we require for our future workforce and is an opportunity to bring our teams in Brisbane together into one location,” Suncorp chief executive Michael Cameron said.
Mirvac chief executive Susan Lloyd-Hurwitz said the company had worked closely with Suncorp and architecture firm Woods Bagot on the deal for a number of months.
“We have been able to provide Suncorp with a superior, bespoke workplace solution that meets all of their strategic objectives, and allows for flexibility into the future.”
The $800 million, 32-storey development has been described as a “city within a building”, spanning an entire block between Ann and Turbot streets.
“The design returns the last remaining piece of Brisbane’s oldest surviving fruit and produce market on Turbot Street back into the city fabric, and – with its overwhelmingly public and porous ground floors – will act as a catalyst to the upcoming Brisbane Live precinct and the development of the north-west quarter of the CBD around the Roma Street Station,” Woods Bagot director Mark Damant said.
The 80 Ann Street development will provide 6 Star Green Star, 5 Star NABERS Energy and Gold Shell and Core WELL ratings.
Subject to Mirvac finalising the land acquisition from Wee Hur, Suncorp will move into its new, consolidated digs by September 2022.
Walker Corp Offloads Proposed Ann Street Tower
Property fund manager EG has acquired a site in Brisbane’s Fortitude Valley, just 1km north of its CBD, for $27.72 million on a tight 4.7 per cent net yield.
The 3,582sq m site has development approval for two separate schemes — one residential, one commercial — with Lang Walker’s Walker Corporation scrapping the apartment scheme after the market turned in 2017.
Walker Corporation acquired the whole-block island site in 2015 for $22.2 million.
The developer later won approval for a 26-storey A-grade office tower comprising 44,000sq m of net lettable area and ground floor retail. Cox Architecture designed the scheme.
The $400 million green star-rated office tower would eventually house up to 5,000 workers, Walker Corporation said.
Located close to trendy James Street, EG’s latest asset joins a swathe of office development in the area including Consolidated Properties’ $250 million office scheme at 895 Ann Street and Pellegrino Group’s commercial building at 89 McLachlan Street.
The 801 Ann Street site is the eighth asset to join EG’s Yield Plus Infrastructure No. 2 fund, which has a $750 million real estate mandate.
EG has more than $2.4 billion worth of assets under management.
In 2018, the Sydney-based fund manager picked up a 17-storey Brisbane office tower from Peter Harburg’s portfolio and offloaded Fortitude Valley’s Optus Centre site for $23.5 million.
The site, which had approval for a controversial apartment scheme, was acquired by Scott Hutchinson of Hutchinson Builders for the 3,300-person capacity Fortitude Valley Music Hall.
A spokesperson for EG Funds said that the site had been initially acquired as a yield producing asset. The Volvo showroom and car service centre lease expires in 2024.
The transaction was brokered off-market by JLL’s Seb Turnbull.
PortGate Logistics signs on for 30 years in Brisbane
Transport and logistics operator, PortGate Logistics, will relocate to a new three hectare site as part of the Fisherman Islands development at the Port of Brisbane.
A sub-tenant of Portgate Properties, PortGate Logistics has committed to a 30-year lease deal that will include purpose-built facilities comprising a 6000 square metre warehouse, container hardstand, office building and car parking.
Additional areas will be developed for log storage and pack-unpack facilities.
Portgate Properties Pty Ltd currently sub-lease several warehouses and hardstand areas within the Port of Brisbane PortGate precinct where it has maintained a presence since 2006.
Brothers Steve and Terry Tzaneros have run container parks on Fisherman Islands since the early 1990s.
Port of Brisbane CEO, Roy Cummins, said the lease not only reaffirmed PBPL’s long-standing partnership with PortGate Logistics, but the new location would enable PortGate Logistics to deliver great benefits to its customers.
“We were very pleased to be able to work closely with PortGate Logistics to identify an opportunity for them to relocate ‘on Island’, which will also allow their customers more convenient access to the container terminals,” he said.
“This is another demonstration of the Port of Brisbane’s ability to work with our existing customers to support their relocation or expansion requirements, and provide long-term certainty for all parties,” said Cummins.
“The Port of Brisbane’s property revolution continues to go from strength to strength.”
In a joint statement, Arthur and John Tzaneros said, “For PortGate Logistics to continue growing it needed to move on their own designated site, Office, Warehouse, Full Container Park & Reefer Area, Large Fumigation areas for Containers, Break Bulk Area, the Facility will also be licenced as a Bond & Quarantine Facility as well as being a few hundred metres from the Container Terminals.”
“This is only part of our strategy for our future and the Port of Brisbane has enabled us to make this work, we look forward in working with the Port of Brisbane and all our clients into the long future we have ahead of us.”
PortGate Logistics has engaged Space Frame to construct the facility.
Construction is expected to be completed June 2019.
Savills sell two Bowen Hills, Brisbane properties to 99 Bikes
National bike giant 99 Bikes has spent $5.5 million buying two adjoining properties in Brisbane’s Bowen Hills.
They’re set to consolidate two existing stores in to the one property at 62-66 Abbotsford Road.
Savills agents Gregory Woods and Daniel Pepper negotiated the deal, with 111 enquiries received throughout the campaign.
The new superstore is in replacement of the previous stores located in Fortitude Valley and Windsor, and will also house administration, logistics and warehousing needs for the business.
Woods said the building size and location was ideal for the retailer, with the high level of exposure a major draw card.
“We had originally taken the property next door to market, with 99 Bikes inspecting the facility, however they expressed a need for a larger space.
“Fortunately, the seller also owned some adjoining properties which is what prompted the sale of 62-66 Abbotsford off- market,” Mr Woods said.
The properties are situated on a total 2,028sq m site, achieving a rate of $3,309 per square meter by total building area of 1,662sq m.
Pepper said owner occupiers continue to be attracted to Bowen Hills, due to its underlying land value and future development potential.
“Evidenced by the significant enquiry we received throughout the campaign, we are seeing an increased interest in Bowen Hills due to the significant price disparity between neighbouring suburbs such as Newstead,” Mr Pepper said.
Managing Director of 99 Bikes, Matt Turner, said the new store is set to open on Thursday 20 June 2019, with the online warehouse up and running from the new location now.
“When the store opens there will be an extended range with express click and collect from the online store,” Mr Turner said.
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