Ascendas-Singbridge buy boosts North Sydney confidence

North Sydney’s 20-level Innovation Place, which was sold by the Salteri family.

Singapore-based real estate firm Ascendas-Singbridge Group will place a North Sydney office tower — bought for more than $315 million — into an Asia-Pacific private office fund for which it is seeking to raise up to $1.9 billion.

The move will bolster confidence in North Sydney’s office market, where most space in a ­series of new developments has been snapped up and more towers are getting under way.

Ascendas-Singbridge says it has completed the acquisition of 100 Arthur St in North Sydney as part of its expansion into the local office market.

The building, known as Innovation Place, was sold by the Salteri family, advised by Altis Property Partners.

CBRE’s Josh Cullen and Scott Gray-Spencer steered an ­expressions of interest campaign, but did not return calls yesterday.

The Salteri family had owned the site since 1960, building the 20-level office tower in 2007

The Australian tipped Ascendas-Singbridge as leading the field of buyers last December, and the deal showed even tighter pricing than on such top buildings as Singapore-listed Suntec REIT’s $413.19 million purchase of 177 Pacific Highway from Leighton Holdings in 2013.

The high quality A-grade ­office tower is on the eastern edge of the North Sydney CBD and is considered a local landmark due to its sky ­signage, licensed to construction group Laing O’Rourke.

The Salteri family had owned the site since 1960, building the 20-level office tower in 2007. It spans a net lettable area of 27,196sqm, with three levels of basement parking for 141 cars.

The property, to be renamed Ascendas Innovation Place, is now held in a vehicle set up for the new fund, which invests in core office real estate in the gateway cities of Singapore, Australia, Korea and Japan.

It is Ascendas-Singbridge’s first foray into the commercial office sector in Australia, and builds on the group’s portfolio in the market following the acquisition of 27 logistics properties by Singapore-listed Ascendas Real Estate Investment Trust last year in a $1 billion deal.

The high quality A-grade ­office tower is on the eastern edge of the North Sydney CBD and is considered a local landmark due to its sky ­signage

The deal brings Ascendas-Singbridge’s assets under management in Australia to about $S2 billion. The Ascendas Hospitality Trust, which owns seven hotels locally, as well as hotels in Asia, is on the block.

US private equity house Blackstone has vied with Hong Kong’s Gaw Capital Partners for the fund, with the latter now believed to be favoured in the race.

Other players are also buying property in North Sydney.

Dexus Property Group and its wholesale fund last month bought a prime commercial site in North Sydney from engineering firm Laing O’Rourke and plan to develop a $467.5 million tower. Dexus is proposing to build a premium 34-level skyscraper, to be known as 100 Mount Street, North Sydney, and will start midyear.

This article originally appeared on www.theaustralian.com.au/property.