Keppel Capital Eyes $500m Circular Quay Tower


Singaporean asset manager Keppel Capital is in pole position to land a half stake in developer Poly Global's $500 million office development at Sydney's Circular Quay.

Last year Poly Australia, the Shanghai-listed subsidiary of Poly Global, invited interest for a stake in the 210-220 George Street development, a 17,000sq m commercial building spanning 28-storeys.

Since then there have been several approaches for the possible sale of a portion of the property including the GPT Group and its unlisted office fund, which withdrew an offer for a $260 million half stake.

Keppel Capital, already an active player on Australian shores, with a range of exposures in CBD markets, is now understood to be undertaking due diligence on the tower to be known as the Poly Centre.

The George Street transaction, if realised, would align with Keppel's recent play, last month forming a joint venture company with Australian Unity in order to focus on the Australian metropolitan office sector.

▲The Grimshaw design commercial tower comprises 17,000sq m of office space and 1,000 sq m of retail. Image: Grimshaw Architects
▲The Grimshaw design commercial tower comprises 17,000sq m of office space and 1,000 sq m of retail. Image: Grimshaw Architects

Singapore's Keppel REIT, which holds a $8.6 billion portfolio, is already a big player in the Australian market, with investments in Sydney, Melbourne, Brisbane, and Perth.

In 2017, a $348 million deal was struck with Australia Post that saw it take a half stake in a 39-storey tower at 311 Spencer Street, to be home to the Victoria Police.

Late last year, Keppel enquired about an A-grade office tower in North Sydney as well as Blackstone's 100 Market Street which was eventually sold to the $31 billion Hong Kong-listed Link REIT for $683 million.

Knight Frank’s Dominic Ong, Ben Schubert, Jonathan Vaughan and Paul Roberts, who have been enlisted by Poly to market the 49 per cent stake on the George Street development, declined to comment on Keppel's approach.

Poly, along with construction group Watpac, have recently completed demolition works on site and will press forward with early contracting works for the A-grade tower.

Poly is keen to remain majority invested in the project and deliver it but is hoping the move will enable it to ramp up its broader development pipeline that also includes residential projects.

The developer, which launched in Australia in 2014, has built up a pipeline of more than $2 billion under the guidance of managing director Arthur Wang.

The group recently purchased an office building for $270 million at 59 Goulburn Street, with plans for a 38-storey tower with 407 hotel suites and 90 residential units.

Poly also has plans for its first development in Queensland after buying a corner site in Ascot for $35.25 million.

The developer is also eyeing properties in Adelaide, Canberra and Auckland as it expands the business.

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