EG Funds Management announced the acquisition of 175-177 Cleveland St, Redfern on behalf of the Yield Plus Infrastructure No. 2 fund, representing an exciting opportunity to participate in the continuing urban renewal of one of Sydney’s most iconic city fringe suburbs.
The freehold property presently comprises two existing, creative office buildings located within 2km of the Sydney CBD.
The site is located close to the intersection of Regent and Cleveland Streets and is in close proximity to the campus of Sydney University, Redfern and Central Railway Stations and is a short distance to the University of Notre Dame, the University of Technology and Broadway shopping complex.
“Positioned on the doorstep of major employment, education and transport infrastructure, it’s an exciting location and an ideal setting to showcase EG’s design excellence and Build In Good (BIG) thinking around social, economic and community benefit,” said Associate Director Mark Watson.
EG Funds paid $18.775m for the site which was brokered by Savills.
The Yield Plus Infrastructure No.2. fund was launched in August 2016 with a $750 million real estate mandate. The fund strategy seeks to acquire yield producing real estate assets within close proximity to urban renewal and transport infrastructure opportunities.
The property has a net income of $323,000 per annum, providing a passing yield of just 1.7%.
The 1,060sqm property is situated in a mixed use business zone under the Sydney LEP and within the Redfern–Waterloo State Significant Authority area with an FSR of 3:1.
The previous owners of the site sought to obtain approval in 2017 for a 20 unit apartment complex together with a 45 room Hotel, however Council objected to the proposal due to FSR exceedance, inconsistency with respect to the Apartment Design Guidelines. The property owners ultimately won an appeal at the Land & Environment Court in 2018.
EG have not stated whether they intend to pursue the approved development scheme or an alternative.
Founded in 2000, EG is investing $3.2 billion in real estate on behalf of super funds and private wealth clients to generate outstanding returns with lasting social impact. EG is committed to finding a better path to better investor returns.