Mirvac has acquired the other 50 per cent of Sydney’s blue-chip EY Centre from AMP Capital Wholesale Office Fund through its pre-emptive rights as co-owner.
The $575-million expenditure was secured with an aligned capital partner, British investor M&G Real Estate, who will co-own 200 George Street with Mirvac.
Mirvac’s chief investment officer Brett Draffen said Mirvac had outbid Lendlease and other notables including Allianz, Nuveen Real Estate and Blackstone.
“This transaction demonstrates the confidence in Sydney’s CBD office market and the ongoing demand for high-quality, modern, well-located assets,” Draffen said.
“It is also another example of Mirvac’s ability to create opportunities for our aligned capital partners and validates the strength of our existing relationships.”
Cushman & Wakefield and Savills facilitated the transaction at a 4.1 per cent capitalisation rate, which was indicative of the competitiveness of the market and a paucity of premium-grade office space in the Sydney market.
AMP and Mirvac unveiled the jointly-owned EY Centre in 2016 with adaptable workspaces and premium-grade offices for EY’s headquarters in the Circular Quay precinct.
The 37-storey tower has a net lettable area of about 39,200 sq m of premium grade office space, a closed cavity facade with timber blinds, and a 6-star Green Star Energy and a 5-star NABERS ratings.
The AMP Capital Wholesale Office Fund (AWOF) share in 200 George Street was part of its $7-billion flagship portfolio, which also included Melbourne’s Collins Place, and the Quay Quarter Tower in Sydney.
Big Australian property players including Dexus, GPT, Charter Hall and Stockland were understood to have tabled offers for AWOF with Jarden Australia earlier this year as either a standalone takeover bid, or a merger with the unlisted fund.
It follows investors voting to merge AMP Capital's $5-billion Diversified Property Fund with ASX-listed Dexus' $10.1-billion wholesale fund.
But any decision on the fate of the office fund is wrapped up in a complex demerger following a failed deal with Ares Management, which AWOF was included in as part of the offering.
The demerger should take a further 12 months.