An Iconic Chatswood Office tower has been sold for $56m.
The 1,657sqm site, at 815 Pacific Highway, contains a B Grade office building which was built in the 1960’s and features an iconic external lift, which in its hey-day serviced a top floor restaurant offering expansive views over Western Sydney.
The 13 storey office building now contains 6,765sqm of office leased to a range of tenants with a 2 year WALE.
The Vendors, Lindfield Developments Pty Ltd had hoped to secure a redevelopment proposal for the site, submitting a planning proposal in 2015 for a 9,000sqm office building over 35 storeys (130m), including a top floor restaurant. The proposal did not find support with the Council and was ultimately withdrawn in 2016.
Under the current planning scheme, the site is zoned B3 Commercial with a 5:1 FSR (8,245sqm max GFA) and height limit of 60m, effectively rendering the site fully developed in its current form.
The property was marketed by in April 2021 through Knight Frank’s, Tyler Talbot and Dominic Ong. At the time the agents said the owners were looking to take advantage of the escalating interest from developers buying sites along the proposed Sydney metro line from Chatswood to the CBD.
At the time of offering the property to market it was 94% occupied and provided passing income of $2,875,000 per annum (if fully let). Based on the acquisition price, the fully let income yield equates to 4.9% yield.
The western side of the Chatswood CBD is a focus of recent attention with a proposal by Chatswood RSL Club who have been given approved for a new purpose-built RSL Club over four levels totalling 6790sqm, plus a 18 storeys commercial tower totalling 28,070sq m and 263 car parking spaces at basement level. Cromwell and partner, Blackrock, secured plans for a third office tower into on their site at 475 Victoria Ave.
Interest in the office market is picking up as tenants and investors seek to capitalise on the completion of the new Metro Rail linking the Sydney CBD to Chatswood and out to the north west suburbs.
According to Knight Franks latest Chatswood Office Market report, vacancy rates in Chatswood have increased to 15.6% which together with a surge in sub lease space hitting the market has seen incentives increase to above 30%. The recent moves by several Government agencies to St Leonards and Parramatta hasn’t helped the market.
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