Charter Hall swoops on Gosford gem in $64m play

Charter Hall chief executive David Harrison. Picture: Chris Pavlich

Property funds house Charter Hall is pushing more deeply into the long-lease office market, picking up a building in the NSW regional city of Gosford for $64.1m.

The David Harrison-led company’s direct property arm has secured the building occupied by the NSW government from developer St Hilliers on a yield of about 5.4 per cent.

Charter Hall has been busy this financial year, with major purchases including a half-stake in Melbourne‘s Southern Cross Towers complex in Melbourne on behalf of its flagship office fund.

Developer St Hilliers tapped agencies CI Australia and JLL to sell the complex at 32 Mann Street, and they promoted its strong environmental credentials. The building is the only 5.5 Star building and one of only two A-grade buildings in Gosford’s government precinct and is adjacent to the Australian Taxation Office.

The building is 94 per cent leased to the NSW government with a weighted average lease expiry by income of 8.86 years. About 68.4 per cent is leased to Property NSW on a 15 year lease, with 11.6 years remaining.

The 7268sq m complex has 105 car spaces and was completed in 2019. It spins off a net operating income of $3.46m.

Agents CI Australia‘s Michael Stokes and Shirley Fan and JLL’s James Aroney and Mitch Noonan declined to comment.

The property was billed as a bond-like investment with a strong covenant.

Gosford has been earmarked for significant development and growth driven by government and the local council.

The area is being driven by the creation of the State Environmental Planning Policy (SEPP) Gosford City Centre 2018, Gosford City Centre DCP 2018 and The Central Coast Regional Plan 2036, which was recently updated to the draft Central Coast Regional Plan 2041.