Mapletree leads race for major Chatswood tower

The tower at 67 Albert Ave, Chatswood, in Sydney.

The strong appetite for Sydney’s suburban office towers has been put on display as Singaporean group Mapletree Investments leads the race to buy RF CorVal’s Chatswood tower for about $150 million.

Values in Sydney’s central business district have been bid up by international groups including TH Real Estate, Japan’s Daibiru, US private equity group Blackstone and superannuation fund-backed ISPT.

Now a new round of buying is showing the depth of demand for office assets in key areas of Sydney including Chatswood, North Sydney and Parramatta.

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The appetite for city fringe and suburban office assets is national, with Mapletree last year also snapping up a $145 million office tower on Melbourne’s St Kilda Road.

That purchase, from an unlisted trust run by Newmark Capital, marked Mapletree’s first acquisition of an office building in Melbourne and added to its $1.1 billion portfolio.

Mapletree, which declined to comment yesterday, already has office assets in Sydney, Melbourne, Brisbane and Perth. Its portfolio in Australia also includes logistics, office and serviced apartment assets.

Mapletree is well-versed in suburban office markets and forged into Australia via the purchase of a building in South Brisbane in 2014.

It will be looking to benefit from the rising demand for Sydney’s north shore office towers, as the area benefits from infrastructure investment and its growth as a retail and office precinct.

RF CorVal put the Chatswood property, which can also accommodate a new boutique building on the site’s surplus land, on the block in August.

The property fund manager bought the Sydney tower at 67 ­Albert Ave for $84 million in 2014 from Eureka Funds Management’s Core Property Fund 3.

The building, held in the unlisted Value Active Fund, is one of only five true A-Grade buildings in Chatswood. The sale will see that fund wound up.

Cushman & Wakefield’s Steven Kearney and Mark Hansen and Colliers International’s Adam Woodward and Jon Chomley are handling the sale.

The offer generated substantial interest among local and international institutions chasing Sydney’s major suburban office locations.

The Chatswood property comprises 14,800sqm of space and parking for 193 cars. It sports large floorplates of 1100sq m, and has an efficient side core creating unobstructed views. The development approval is for a second 7100sq m office tower on the site.

The existing building has a weighted average lease expiry of three years, consistent income and the potential to benefit from rising rents in Chatswood. The asset is 97 per cent leased.

Attention is now turning to an A-grade office building in St Leonards offered by Anton Real Estate Partners. It is selling 72 Christie St, which spans 11,259sqm and is leased to Mastercard for 10 years. It is tipped to fetch more than $150 million.

Insurance group Zurich Fin­ancial Services is also tapping into interest in North Sydney with the offer of the $350 million-plus building it is developing.

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