Chinese group pays $82m for major Parramatta office block

80 George St, Parramatta: The Chinese group is eying the area’s rental growth.

A Chinese group has swooped on an office block in the heart of Parramatta for about $82 million as Sydney’s suburban office boom rolls on, with new benchmarks being set across the city.

The private group has picked up 80 George St and is keen to access the area’s rental growth and future development upside of the property, which abuts major civic work projects.

The sale at just over 5% shows how keen mid-sized investors are to get set in the area as larger developers including Lang Walker roll out projects and win more tenants.

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Walker’s Parramatta Square development this week said it had attracted two new tenants, with GT Insurance and Universal Fitness committing to 4 Parramatta Square, the first of the four towers to open later this year.

GT Insurance and Universal Fitness will join anchor tenant the NSW government in the 65,000sq m, 40-storey building, with plans to occupy the building as part of the stage 1 opening in December.

Elsewhere in the city there has been a surge in office block buying.

Last week an Asian investor bought a North Sydney office block at 107 Mount St for about $115 million, while the latest play also beat expectations.

In another record deal for a suburban area, Taiwanese developer Shayher also snapped up a twin-building office complex in Sydney’s inner west for about $63m.

Those two buildings at 2-6 Cavill Avenue, Ashfield, were sold by Greg Shand’s Barana Group, which picked them up for $47m in 2015.

Parramatta is also showing major gains. The vendor in George Street, Diamond Genest, bought the complex in late 2016 for $51.9m from a GDI Property Group-run fund.

That group had picked it up for $38.7 million in early 2015.

The site held a strong attraction due to its mix of corporate tenants and future development upside.

Sitting on the corner of George St and Horwood Place, 80 George St comprises a refurbished B-grade office tower, ground-floor retail and two levels of basement parking. The property spans about 8093sqm of lettable space and has a lease term of about five years. The property will also benefit from Parramatta’s cultural upgrades, such as the Civic Link and Powerhouse Museum.

Knight Frank’s Dominic Ong, Tyler Talbot and Wally Scales handled the sale but declined to comment on the deal.

Parramatta’s bustling office market is experiencing strong demand for space.

It has a vacancy rate of just 3% and the market is tipped to surge as new developments come on line over the next two decades.

Attention is now turning to the sale of a major complex in Macquarie Park that has been offered by John Holland for about $320 million.

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