$326M Perth Office Building Eyed by Investors

By Eliza Theiss, Associate Editor

The Perth office market is getting hotter by the moment. Following Brookfield’s announcement to develop Brookfield Place Tower 2, Perth’s CBD is setting up for another significant deal.  Several sources report that the $326 million (AU$350) Exchange Plaza office tower has attracted multiple investors’ attention, all looking to buy a stake in the 40-story trophy tower.

According to The Australian, Singapore-based private equity-style syndication business Rockworth Asset Management Pte Ltd and Sydney-based Morgan Stanley affiliate Investa Property Group are in the early stages of negotiation to purchase a stake in the building. Currently, half of the property’s stake is on the market, as its owner, Colonial First State Property PPS Fund, is looking to shed its interest. CBRE and Jones Lang LaSalle are marketing the office building, located on The Esplanade, in close proximity to Perth waterfront.

Other parties rumored to be interested in the office asset are leading Australian entities such as the Mirvac Group, an integrated real estate group listed on the Australian Securities Exchange, as is the GPT Group, also interested in the asset, which should come as no surprise as GPT is focused on active ownership of high-quality Australian commercial properties. Another property group also speculated to be interested in buying into the office asset is Sydney-based Dexus Property Group. Two local property trusts are also said to be among potential buyers:  the sector-specific Australian REIT Commonwealth Property Office Fund and Industry Superannuation Property Trust, one of the largest unlisted property funds in Australia. AMP Capital, whose AMP Asset Management subsidiary owns half of the Exchange Plaza, declined to exercise its option for first right to purchase. AMP paid approximately $147 million (AU$157.7 million) when it bought into the asset in late 2011. According to The Australian, Colonial’s stake could fetch around $168 million (AU$180 million) upon sale, with a 7 percent yield.

Exchange Plaza, named after the Australian Securities Exchange, whose headquarters it houses, features 366,726 square feet of high-grade office space. The Plaza comprises 33 levels of podium level, low-rise and high-rise office space, a 230-car five-story secure parking component and three plant room levels. The office building also boasts a 120-seat conference center complete with audio-video and kitchen facilities, high-speed lifts, top-of-the-line air conditioning, telecommunications, electrical and security systems, The Vault Health and Fitness Center full-service gym. The 40-story tower was completed in 1992 with Peedle Thorp & Walker as project architects. The Exchange Plaza has 3.5-star NABERS( National Australian Built Environment Rating System) Water rating and a 4.5-star NABERS Energy rating.