Charter Hall wholesale fund CPOF secures iconic Collins Place precinct

Charter Hall Group (Charter Hall or the Group) is pleased to announce that its Charter Hall Prime Office Fund (CPOF or the Fund) has acquired a 100 per cent freehold interest in Collins Place for approximately $65m.

Collins Place is a 13,350m² site, currently comprising approximately 140,000m² of floor space across two towers (at 35 and 55 Collins St), including 100,000m² of A-grade office space plus the Sofitel Hotel. The leasehold interests of Collins Place is owned by the AMP Wholesale Office Fund (AWOF) and is the Fund’s largest single asset.

CPOF purchased Collins Place freehold title from an institutional investor following a process undertaken by Colliers on behalf of the vendor.

Charter Hall Managing Director and Group CEO, David Harrison, said, “Collins Place presents a unique opportunity for CPOF investors to secure one of the largest, freehold title, prime CBD sites nationally. This extends the large precinct holdings owned by CPOF which includes Chifley in Sydney, together with two other Paris end Melbourne CBD precincts in the 10,000m² Wesley site and recently purchased 9,000m² Southern Cross Towers.”

“We have long recognised the value of freehold land and precincts, demonstrated by the 2019 purchase of Sydney’s premium office precinct, Chifley Tower and the subsequent planning process to develop a complimentary South Tower to the existing North Tower. Charter Hall’s strategy, to unlock under-utilised floorspace in prime locations that have the potential to add value to the freehold asset over time, ultimately delivers long term value.

“Equally, at a modest plot ratio of approximately 10:1, we believe Collins Place is significantly under-utilised compared to nearby precincts, such as 80 Collins Street, which secured approval to develop an additional tower to complement the 50-storey Nauru House, to create a 20:1 plus plot ratio. Further along Collins Street, Charter Hall secured planning approval for a twin tower precinct at 555 Collins Street which will accommodate 86,000m² on a site of 3,300m² equating to approximately 24:1 plot ratio.

“We are pleased to have added to our Paris end footprint, with the largest CBD land holding in the Paris end totalling 40,000m² of CBD land including: the Southern Cross, 9,000m² site: the 10,000m² Wesley precinct, the 7,000m² site accommodating the Telstra HQ at 242 Exhibition Street, together with a further 5,000m² at 11 and 288 Exhibition Street,” said Mr Harrison.

Adam Woodward from Colliers negotiated the sale on behalf of the vendor.

CPOF is a $9.5 billion wholesale prime office fund portfolio that has topped the MSCI office index for every annual time period over the last decade, achieving a 10-year total return of 12.2% per annum.