Brisbane-based Sentinel Property Group has snatched up Makerston House in Brisbane CBD's “North Quarter” precinct from investment management company Challenger in a $103 million swoop.
The asset acquisition, which is 100 per cent leased, was sealed on a net passing yield of 7.85 per cent.
The 30 Makerston Street building, located opposite the Queensland Police Service headquarters and 50-metres from the Brisbane Transit Centre and Cross River Rail, marks Sentinel’s largest purchase in its 10-year history.
ASX-listed Challenger has been busy divesting assets, with the recent sales of its $150 million Next Hotel on Brisbane's Queen Street mall this month to Salter Brothers, and the $200 million sale of major office tower 31 Queen Street in Melbourne.
Challenger said the recent sell-down is part of its strategic decision to reduce its real estate asset allocation and shift into fixed-income investment.
Sentinel Property Group managing director Warren Ebert said the purchase forms part of it growing Sentinel Regional Office Trust.
The trust also comprises assets including 200 Creek Street Brisbane, 8 Buller Street in Port Macquarie, 11 Argyle Street, Newcastle, and Central Plaza and River Quays in the Townsville CBD.
The 14-level building, which spans a 1,796sq m site, has a 4.63 year WALE and is leased to the Queensland government along with other state projects which include the $5.4 billion Cross River Rail network and the $2.1 billion Brisbane Live precinct.
Sentinel has a national portfolio of more than 40 retail, industrial, office, land, tourism infrastructure and agribusiness assets across six Australian states and Territories with a total value of more than $1.14 billion.