ASX-listed property owner and fund manager GDI Property Group has purchased Westralia Square, 141 St Georges Terrace, Perth for $216.25 million.
Westralia Square is an A-grade property located on St Georges Terrace in Perth's CBD adjacent to Brookfield Place.
The asset has been offloaded by the Insurance Commission of Western Australia as it completes its property divestment program. It is believed up to five bidders were in the running.
Acquisitive GDI, based in Sydney, has recently announced a conditional deal for IKEA in Innaloo, Perth, for $143.5 million.
141 St Georges Terrace comprises approximately 32,635sqm of net lettable area over 18 levels of office space with an average floor plate of 1,800sqm, above a multilevel car park providing a total of 537 car bays on a mix of tenant and public parking levels. It was constructed in 1991 and the property currently has a 5.0 star NABERS energy rating.
Westralia Square is currently approximately 93.5% occupied (by NLA) with a weighted average lease expiry (WALE) of 2.5 years (by total NLA).
The building is predominantly occupied by State Government departments with lease expiries in the first half of 2020.
GDI Property Group Managing Director, Mr Steve Gillard said, “Westralia Square has all the things we look for in an office building. It is well located, has good natural, easily divisible floor plates, is being acquired for considerably less than replacement cost and offers an opportunity to add significant value through refurbishment and releasing.
“With the State Government leases expiring in the first half of 2020, we expect to be releasing in to a much stronger leasing market and following a major capex program we anticipate high appeal for the property given its central location, excellent river views, large floor plates, significant parking and connectivity to public transport.
“We believe this is another opportunity like 66 Goulburn Street, Sydney, where we can add significant value for our securityholders.”
GDI Property Group proposes to fund the acquisition through the proceeds of the sale of its 66 Goulburn Street, Sydney asset which it recently sold for $252 million, with settlement of that asset anticipated to be on or around 19 October 2017.