Dexus continues to sell down its Office assets with the announced today of the sale of 50% of 309 Kent Street Sydney to AsheMorgan for $401m.
Dexus held 50% of the asset on its balance sheet at $405.5m and controlled the remaining 50% via their recent appointment to manage the AMP Capital Diversified Property Fund (ADPF). ADPF continue to hold their interest however Dexus were in the process of also seeking purchasers for that portion of the asset, which is presumably subject to pre-emptive rights now to be held by AsheMorgan.
309 -321 Kent Street comprises two A-Grade office buildings across 47,702 square metres located in the Sydney CBD.
AsheMorgan are acquiring the asset in a 50:50 partnership with Hong Kong listed Liu Chong Hing Investment Limited. The pair have previously jointly acquired 310 Ann Street, Brisbane.
As at 13 December 2021, the property was 93% occupied with a weighted average lease expiry of 3.5 years.
The acquisition reflects a passing yield of 5.2%.
MYOB recently agreed terms for a 10-year lease over 3,496sqm of office space, moving out of another building on Clarence Street. Other key tenants include Insurance & Care NSW and Sydney IVF.
The sale will realise proceeds of $401 million, with net sale proceeds initially being used to repay debt.
The sale was the result of an on-market sales campaign and is subject to a number of conditions including FIRB application and approval. Subject to the satisfaction of conditions, settlement is expected in April 2022.
The sale of the asset by Dexus, continues the string of exits from the office market. Dexus also announced today the sale of 140 & 150 George Street Parramatta for $160m and comes just a month after Dexus also exchanged contracts to sell 383-395 Kent Street, Sydney to Charter hall for $385m, reflecting an initial passing yield of 5.1%.
Dexus are also expected to sell 130 George Street Parramatta as well as 100 Harris Street in Pyrmont.
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