Holdmark makes Bligh Street swoop for tower
Holdmark has emerged as the buyer of a major Bligh Street complex in the heart of the Sydney CBD that is trading for about $210m.
The building was sold by funds house Fortius, on behalf of Singapore’s SC Capital Partners, which undertook a major refurbishment of the office levels and made plans for a $700m hotel and commercial tower on the site.
MRE’s Sam McVay and Rob Sewell and JLL’s James Barber, Simon Storry and Luke Billiau handled the sale of 4-6 Bligh Street but declined to comment.
Holdmark is stepping up the scale of its operations.
In 2020, it bought a North Sydney tower from the Yuhu property business linked to exiled billionaire Chinese property developer Huang Xiangmo for the symbolic price of $113.888m.
This year it proposed a twin tower project in Parramatta at the site of the heritage-listed Murray Bros building on Church Street. This includes the five-star Intercontinental Hotel and adds to its 85 Macquarie Street development, which will house the Commonwealth Bank, which is slated to finish this year.
The 10,027sq m Bligh Street building in the Sydney core had a $19m refurbishment, which drove strong leasing with more than 70 per cent of the space leased within 12 months, despite COVID-19 impacts.
Tenants have been drawn by the quality fitout and the ability to control their own full floor, a high quality list of largely technology focused tenants have entered the building. These include the likes of Superhero and Shippit.
The office is about 82% leased with strong tenant interest in the remaining levels likely to see it fully occupied by the end of the financial year.
The area is going through a once in a generation transformation with the completion of private and government infrastructure projects. The Sydney Metro will provide two new station entries near the building in 2024 and 2030, allowing office occupiers to be connected by rail to the vast majority of the Greater Sydney area.
The new Macquarie headquarters being constructed above the proposed metro station represents the beginning of a growing trend in the core – transitioning secondary assets into prime via redevelopment. About 90,000sqm of existing commercial space has been earmarked for future redevelopment by major landowners in the precinct.
In addition to stock withdrawal from these private projects, an immediate impact from the Sydney Metro development will be the significant leasing demand increase in the core, generated via the resumption of about 40,000sqm of competing space for the metro works.
Most of this 130,000sqm earmarked for resumption or redevelopment is B Grade stock that directly competes with 4-6 Bligh Street.
There is scope to take advantage of an under-used floor space in the current building by extending the floor plates and repositioning the asset to create a pocket premium offering. This would see an additional 4,850sqm of office space added to the building, whilst providing an opportunity to further improve its sustainability credentials.
Wider scope also exists under a Gateway Determination received by the vendors, which allows for a planning uplift of 22:1 with a 26,752sqm tower allowed.