Brisbane-based investment manager Marquette Properties has snapped up a prime corner retail asset in central Brisbane for $77 million, quickly moving to undertake major refurbishment works.
Marquette, which dipped into the Brisbane office market in April with the purchase of 288 Edward Street for $115 million alongside US real estate investment management firm Heitman, has now partnered with global asset manager PGIM to acquire the high profile retail asset.
The four-storey retail property, with three frontages in the heart of one of Australia's busiest malls, features the largest McDonald’s in the southern hemisphere.
The 1,102sq m site, located on the corner of Queen Street Mall and Albert Street, was previously owned by the Smorgon family — led by the late billionaire Victor Smorgon, who held the site for 23 years.
Marquette now plans to undertake major refurbishment works to reposition the asset into a “trophy investment appropriate to its prime location”.
The property group has engaged Brisbane-based architectural practice Cavill Architects to design a refurbishment that will heighten the visitor experience, retail exposure and increase trade.
The retail and office building, which offers 3,770 square metres, is fully leased with a 5.1-year weighted average lease term. Notable tenants include Gelatissimo, Forever New and Money Exchange.
JLL's Sam Hatcher, who brokered the deal for 130 Queen Street with colleagues Seb Turnbull, Jacob Swan and Luke Billiau, pointed at the “scarcity value” of assets on super-prime strips such as Queen Street Mall.
“CBD retail is one of the most compelling sub-sectors at present given the underlying land value and potential for future adaptive re-use.”
“The property has the potential to be a future multi-level flagship development.”
Marquette's strategic partners PGIM continue to flex their muscle after last year transacting $17 billion worth of property, including acquiring a 75 per cent stake in York & George, a $450 million retail and commercial development at 383 George Street in Sydney.
PGIM also bought and sold 215 Adelaide Street in 2015, following a major refurbishment and they were also the financier behind the Howard Smith Wharves development, providing $70 million in funding.
Marquette and PGIM are now eyeing the underlying fundamentals and potential of Brisbane's most central and prominent retail strip.
“Marquette looks to buy assets and transform them into trophy investments that make the city better,” Marquette managing director Toby Lewis said.
“We also look to buy assets that are familiar to us in our personal and professional lives as we feel it gives us safety and understanding about the asset and its local context to the community around it.
“For us to be acquiring an asset so familiar to us as locals and most ‘Brisbanites’ is really exciting.”
Marquette in partnership with Moelis Australia Asset Management also recently sold 164 Grey Street, South Bank for $46 million.
Refurbishment works for 130 Queen Street are set to commence earlier next year and with completion due mid-2020.