Aveo offloads Gasworks Plaza for $248m

Brisbane’s Gasworks Plaza. Picture: gasworksplaza.com.au

Retirement specialist Aveo Group has exited a major commercial property holding, selling the Gasworks Plaza complex in Newstead, Brisbane, to AMP Capital for $248.4 million.

The sale of Gasworks Plaza, incorporating Gasworks 1, 2 & 3, was a competitive process run by McVay Real Estate, in one of Queensland’s largest deals this year.

Gasworks 1 and 2, is a modern mixed-use development that includes a neighbourhood shopping centre of about 8740sqm, anchored by a Woolworths supermarket with 31 specialty tenants, along with 8994sqm of office space across two buildings and a car park with 426 spaces.

Commercial Insights: Subscribe to receive the latest news and updates

The completion of Gasworks 3, which is under construction, will add a further 1100 sqm of retail space and 81 car park spaces.

After allowing for Gasworks Plaza’s carrying amount of $180m in Aveo’s balance sheet at the end of June 2017, and taking into account sale costs, the sale will generate a surplus of $61m. This equates to an increase in net tangible assets per security of 11 cents.

“As we came to the completion of the Aveo-owned component of the Gasworks precinct, it was opportune to capitalise on the embedded value of the Gasworks retail and commercial component,” Aveo chief executive Geoff Grady says.

Geoff Brady AVEO

AVEO’s Geoff Grady. Pic: David Kelly.

“This transaction will release substantial capital for recycling into higher returning development projects,” he adds.

The sale of Gasworks Plaza comes on the eve of the completion of Aveo Newstead, a 19-storey retirement living tower, that will be finished next year.

The retirement village operator is forecasting sales to return to normal levels after falling 40% on the back of damning media reports about the industry.

Weeks after media reports exposed residents’ concerns about exit fees imposed by Aveo, prompting a class action to be filed by Levitt Robinson solicitors, sales inquiries plunged 40% on the previous comparative period.

But since then sales inquiry rates have improved.

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