Charter Hall Splashes $67m on Education Precinct

Charter Hall’s Social Infrastructure REIT (CQE) has taken a 49.9 per cent share in the newly developed Innovation Quarter in the healthcare and research precinct at Westmead.

Charter Hall and Western Sydney University jointly developed the $350-million healthcare, medical research and education facility next to Westmead Hospital. It’s another indicator of the value of social infrastructure in 2023. 

The iQ is an A-grade building designed to achieve a 5-Star NABERS energy rating and 4-Star NABERS water rating, as well as a 6-Star Green Star rating as a carbon neutral enabled building. 

The REIT acquired the 49.9 per cent interest for $66.9 million on a 4.8 per cent capitalisation rate, funded through the full divestment of securities held in the Arena REIT and the sale of five non-core early learning properties. 

CQE fund manager Travis Butcher said the acquisition was in line with the REITs strategic remit 

“Consistent with CQE’s active portfolio curation strategy, we’re pleased to add a high quality, new social infrastructure property to the portfolio with strong property fundamentals funded through the divestment of non-core assets,” Butcher said.  

Innovation Quarter is in the Westmead Strategic Precinct, whose primary function is as a health, research and education hub. 

Western Sydney University occupies about 47 per cent of iQ on a 15-year initial term with the CSIRO taking up about 16 per cent of the property on a 10-year initial term. Other major tenants include Telstra Health, Psych Central and WentWest.

The asset comprises a total of 43,000sq m of mixeduse research, health, education and retail space across three towers, with large flexible floor floorplates and future-proofed technology. 

The east and west towers will share a central square, lined with cafes, restaurants, bars, and shopfronts. 

Technology such as smart meters, intelligent lighting, and optimised daylight penetration will be used at iQ to minimise the buildings’ energy consumption to help achieve the energy ratings. 

The first stage of the precinct was opened late last year, fully leased.