Mirvac Sells Brisbane Tower for $104.4m

Mirvac has sold its office building in Brisbane’s South Bank for $104.4 million. 

Real estate investment manager Marquette Properties picked up the property at 189 Grey Street in an off-market transaction. 

Mirvac developed the building in 2005, which sits alongside just six other office buildings at South Bank, Brisbane’s tightest office market. 

The building is a 12-storey, A-grade office tower with 12,595sq m of net lettable area and 146 car parking spaces.

It is currently 60 per cent leased to multi-national insurance company IAG, and engineering, construction management and operations service provider Ausenco.

The building is 200m from public transport including bus, rail and ferry stops, and the future Brisbane Metro line. 

The acquisition was negotiated by CBRE’s Tom Phipps. 

Mirvac is divesting certain assets to fund its recent acquisitions and its development pipeline.

It has just wrapped up its Pimpama masterplan project on the Gold Coast and sold the Cherrybrook Village Shopping Centre to Sim Lian-Metro Capital for around $132.8 million last year.

Mirvac also sold its Perth office tower to Centuria Capital and MA Financial Group for $223 million.

▲ The building is one of only seven office towers in Brisbane's South Bank.

Marquette managing director Toby Lewis said it was a key asset to acquire. 

“We are grateful for the opportunity to buy this asset and be custodians of a Mirvac designed, developed and managed building with enduring value and quality,” he said.  

Lewis also said that Southbank has a minimal office vacancy rate with just one and a half floors at 189 Grey Street currently vacant but expected to be leased in the short term. 

“We’d argue that Grey Street is among the top three streets in Brisbane for office buildings, offering amenity among the best in our city,” he said.

CBRE’s Phipps said that with little competition from overseas direct capital and other sources, there was a different mix of investor types keen to acquire certain assets.

“With very little REIT, wholesale or offshore direct capital currently active we are seeing syndicators, club investors and privates taking advantage of the current market volatility to secure quality assets that larger institutions deem too small or non-core,” Phipps said.

“We had made several approaches to acquire 189 Grey Street on Marquette’s behalf and were ready to act when Mirvac elected to sell.”

Lewis said Marquette keep treading carefully in what it chose to acquire.

“We remain cautious but acquisitive and feel that the significant volatility across markets augurs well for commercial property,” he said. 

“We will keep our assumptions around interest rates and cap rates conservative but feel next year will be a big bounce back for our industry.”