Su-Lin Tan Reporter
May 1, 2019 — 9.00pm
Sydney-based property development and investment group Kyko Group has swooped on Brisbane CBD’s 201 Charlotte Street ofﬁce tower for $126.7 million.
Fortius Funds Management and two private funds managed by BlackRock sold the building on an initial yield of 5.94 per cent, as deal-making in the Brisbane ofﬁce sector continues to heat up.
The listing had attracted ﬁve local bids since it went up in February. Kyko owns properties in the ofﬁce, retail, residential and hospitality sectors and is led by Bill Jenkings.
“When we look around the country, Brisbane is one of the most heavily traded markets in 2019 with investors ﬁnding favour in higher returns and improving fundamentals. We anticipate similar transaction volumes in the second and third quarter,” CBRE’s Flint Davidson said.
He and Tom Phipps, as well as Knight Frank’s Justin Bond and Ben McGrath, were responsible for the deal.
The A-grade Charlotte Street tower has a net lettable area of 13,291sq m, with major tenants including Anglo American Metallurgical Coal, the world’s third largest metallurgical coal mining company.
The building is 87 per cent occupied and offers a weighted average lease expiry of ﬁve years. It was recently refurbished and offers childcare facilities, an F45 gym, cafe, end-of- trip facilities and a valet car service.
Mr Phipps said the infrastructure changes around 201 Charlotte Street – including the Cross River Rail, the Waterfront Precinct and Queen’s Wharf Integrated Resort and Casino – made the tower an attractive buy.
The Brisbane ofﬁce market is attracting new investors as it recorded the largest drop in ofﬁce vacancy compared to any other state capital over the past six months, with a drop to 13 per cent in January, from 14.7 per cent in July.
GIC has already been investing in the Brisbane market, while players including Mirvac are winning tenants and investors for major projects such as 80 Ann Street.