Virgin headquarters sold for $94m
Charter Hall’s Long Wale REIT has tapped the market for $94.1 million in order to buy the Virgin head office in Brisbane and refresh its balance sheet.
The listed Charter Hall-run fund bought the building at 56 Edmondstone Rd from the group’s wholesale arm, which had been marketing the Bowen Hills property via CBRE’s Bruce Baker and Flint Davidson and Savills’ Anthony Ott and Peter Chapple.
Charter Hall has been active in Brisbane and is in the process of buying the city’s Santos Place office building that was put on the block by Malaysian government-backed investment group Permodalan Nasional. The state-supported group could reap about $350m from that sale.
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The raising, undertaken by investment bank UBS by way of a one-for-9.25 accelerated non-renounceable pro rata entitlement offer, was at $4.15 per security, a 3.5% discount to Friday’s closing price.
The Brisbane office is leased to Virgin until 2026.
The move could be a sign that capital raisings are back in the property sector after very little new equity was issued for most of this year.
APN Property Group listed a trust and Dexus and Charter Hall separately raised equity earlier in the year, but activity has been sued as the sector has been under pressure due to the woes of retail landlords.
The Charter Hall-run REIT also undertook an independent revaluation of properties representing 39% of the portfolio’s value this month, reaping a $19.6 million uplift.
It bought the Virgin office in Bowen Hills as it see values rising in the Brisbane fringe office market. The A-grade complex comprises 12,427sqm of net lettable area across three low-rise office buildings and is fully leased to the airline with an 8.4-year weighted term.
This article originally appeared on www.theaustralian.com.au/property.
