Weekly Transaction Update – 11th May

12 May 2018

This week we recorded 9 major transactions worth $694M. The largest deal this week was an acquisition by Zone Q investments of 55 Clarence Street Sydney for $255M. The acquisition is reported to be on a 3.6% passing yield. Zone Q have been active in the market in recent years spending just under $600M with the purchase of 3 assets in Perth together with 637 Flinders Street in Melbourne and another in Milsons Point. 55 Clarence Street is a 14,888sqm B Grade commercial building with a WALE of 2.3 yrs. The building, held by Eureka Funds Management in 2016 was expected to sell to Cuty Freeholds in mid 2016, however after that sale fell through, AEW stepped up to acquire the building in late 2016 for $170M. The sale to Zone Q at $255M ($17,128/sqm) provides AEW with a significant 50% capital gain in just 18 months. The second pot of gold from Clarence Street this week was from the sale of 117 Clarence Street. This asset was traded by Altis in 2015 to Roxy Pacific for $81M and this week (3 years later) Roxy have agreed terms to sell to Investa Property Group on a 4.9% yield for $153M ($12,489/sqm). Also this week Stockland advised that it had sold 77 Pacific Highway for $112M ($11,931/sqm). Whilst the buyer is not disclosed the ideal purchaser would have been the asian buyer of the adjoining building at 1 Pacific Highway which sold last November for $114M ($14,983/sqm). The prominence of the combined sites would be well suited to a new development with the current building height limit allowing for approx 35 levels to be developed on the site. Scroll through the list below or head to RE-Intel for further details. * indicates unconfirmed price or apportionment of a portfolio sale