Centuria Metropolitan REIT has raised close to $185 million in order to partially fund its purchase of the NewActon Nishi Building in Canberra.
Centuria bought the A-grade office complex and also unveiled an underwritten institutional placement to raise $185 million at $3.00 per unit.
Centuria, Australia’s largest office REIT, will also undertake a $10 million non-underwritten unit purchase plan and has benefited from $30.8 million worth of property revaluations.
The acquisition expands Centuria's portfolio value to $2.1 billion, dipping into the ACT Australia's fourth largest office market.
The eco-friendly Nishi building, located at 2 Phillip Law Street, was developed by the family-run developer Molonglo Group and was home to the 68-room Hotel Hotel until the group sold the business to Ovolo Hotels last year.
The building is also home to federal government departments, Clayton Utz and the Palace Electric cinema.
“Nishi provides excellent amenity for the NewActon and Civic precincts while the large floor plates create an efficient design that can accommodate a range of government or corporate tenants,” CMA fund manager Grant Nichols said.
The sale, brokered by JLL and supported by Colliers, includes the heritage pavilion, retail kiosk and the gallery in the John Avery Gardens.
“Canberra’s A grade market continues to demonstrate strong fundamentals with vacancy rates below 5 per cent, the lowest levels in the last decade and balanced supply forecasts that are supported by healthy pre-commitment levels.”
“The Civic and NewActon precincts are very well positioned to benefit from future infrastructure plans across the Canberra market, which will open new commuting opportunities that can support employee well-being.”
The move follows the group's recent purchase of 348 Edward Street in Brisbane's CBD for $89 million and the $381 million spent on office properties in Sydney and Perth.
Centuria has also retracted its 483-517 Kingsford Smith Drive property in Brisbane from the market, due to the reduced geographic weighting towards Queensland after the acquisition.