Brookfield to Offer Premium Boutique CBD Office Buildings

2 May 2022

Neighbouring Carrington Street office buildings, restored in tandem with the $2 billion Brookfield Place Sydney development, have been listed for sale as buyers circle CBD investment opportunities.

Brookfield has appointed CBRE’s Harry George, Danny Shi and Hugh Thompson, together with CI’s Mike Stokes, John Bowie Wilson and Shirley Fan, to market 32 and 36 Carrington Street – premium boutique office buildings directly adjoining Brookfield Place.

The buildings are being offered together or individually, with the sale campaign expected to generate significant interest from high-net-worth investors (HNWIs), both locally and offshore.

CBRE’s Mr George noted, “These are two of the finest examples of refurbished boutique office buildings in Australia. More than $26 million has been invested in substantial building upgrades, delivering workspaces typically associated with premium-grade buildings.”

“This has been reflected in tenant take-up, with 44% of 36 Carrington Street leased in recent months, taking the building’s office occupancy to 100%. The buildings also offer strong ESG credentials and line up against HNWI wish list requirements for fully upgraded, freehold assets with attractive weighted average lease expiry (WALE) profiles and a strong market presence.”

“Only one building in this price range has traded in the Sydney CBD core in the past three years, highlighting the scarcity of investment opportunities in this category.”

Key occupiers across the two buildings include Airservices Australia, rental housing expert Greystar, commercial and industrial energy retailer Smartest Energy, national design-build firm Inscape Projects Group and software producer Alfa.

Both buildings offer new foyers, each with recently completed end-of-trip facilities and new elevators and services. They are positioned to capitalise on the ongoing revitalisation of the Wynyard precinct and connectivity via the adjoining Wynyard rail/bus interchange.

The larger 36 Carrington Street asset offers 2,874sqm of lower ground and ground floor retail and upper-level office space over 10 floors, while 32 Carrington Street – an example of 1920s Georgian Revival architecture -comprises 2,128sqm of character office and retail space. Both buildings overlook Wynyard Park.

In addition to being extensively refurbished, the buildings offer attractive WALEs – 4.7 years from 10 tenants in 32 Carrington Street and 4.3 years from seven tenants in 36 Carrington Street.

Rentals range up to $1,220/sqm net – comparable with prime grade Sydney CBD buildings – reinforcing the tenant value added through the recent refurbishment programs.

CI’s Mr John Bowie Wilson said the sale campaign coincided with strong ongoing investor interest in the Sydney office market, which had proven its resilience during the pandemic and remained a sought-after global investment destination.

“These buildings will be regarded as trophy assets by Asian-based purchasers, who have a strong appetite for quality Australian commercial properties in core CBD locations,” Mr Bowie Wilson said.

The properties offer diversified commercial and retail income streams and are two of only 10 freehold assets, sub-5,000sqm in the CBD that’s north of Martin Place.

The International Expressions of Interest campaign is due to launch in the coming weeks, with a close date of May 26, 2022.