PGIM adds another Queen Street tower

PGIM Real Estate has confirmed the purchase of 444 Queen Street in Brisbane for $54.4 million from sellers Abacus Property Group and The Public Trustee of Queensland, adding to its growing presence on the street.

The 22-storey, 13,967-square-meter office skyscraper, located in the sought-after ‘Golden Triangle’, is on a 1708-square-meter lot with 31 metres of frontage on Queen Street and 72 parking spots.

PGIM Real Estate Managing Director and Head of Australia Steve Bulloch said the Brisbane market was a good investment.

“We are confident in Brisbane’s longer-term fundamentals, driven by strong interstate migration, continued infrastructure spend and increasing offshore investor interest, particularly with the city recently announced to host the 2032 Olympics,” he said.

“The ability to acquire a Queen Street building at this rate ($3,895/sqm) provides an opportunity for us to execute our strategy of repositioning well-located but tired assets to meet the needs of future tenants.”

PGIM Real Estate will modernise the property and optimise its waterfront location and river views by repositioning it to A Grade level through a thorough renovation program.

“This acquisition comes as a strategic response to an accelerated structural shift to higher amenity, well-located CBD office assets that demonstrate strong sustainability characteristics,” Mr Bulloch said.

“Office tenants are becoming more discerning, and this asset will enable PGIM Real Estate to showcase its commitment to ESG, sustainability and innovation. There is also potential to work with our innovation partners at Taronga Ventures throughout the design, construction and operations process.”

CBRE’s Tom Phipps and Peter Chapple, as well as Knight Frank’s Justin Bond and Blake Goddard, advised the vendor.

Tom Phipps said, “This sale demonstrates continued appetite from offshore capital to invest in the Brisbane CBD, despite the closed-border environment.

“Queensland is positioned for growth and Brisbane is attracting local and offshore capital, with an economy benefitting from strong COVID management and nation leading jobs growth.

“This growth is underpinned by the lifestyle and affordability benefits on offer in Queensland, with the State recording the highest levels of interstate migration in Australia.”

Justin Bond said, “Brisbane’s economic outlook is positive and supported by the infrastructure boom which amounts to approximately $19 billion worth of CBD infrastructure and major projects in the pipeline or underway, which will be further supported by 2032 Olympics framework.

This is PGIM Real Estate’s second deal on Queen Street, in recent months, having previously teamed with Fortius Funds Management to acquire 307 Queen Street for $214 million. 130 Queen Street is also owned by PGIM Real Estate and Marquette Properties.

In addition to its recent transactions, PGIM Real Estate has been involved in a number of landmark Brisbane developments, including the financing of Howard Smith Wharves and Silverstone’s Newstead office complex.

It has also recently financed a premium Kangaroo Point apartment development and a mixed-use development in Toowong. PGIM Real Estate was formerly in charge of the renovation of 215 Adelaide Street.

“Offering river views over Customs House, 444 Queen Street has excellent investment fundamentals on which to deliver a modern, institutional grade asset which optimizes its prime Queen Street location and river views.”

PGIM Real Estate is the real estate investment and finance arm of PGIM, Prudential Financial’s $1.5 trillion worldwide asset management company.