Warrington Property has added a Perth CBD office building to its portfolio with the purchase last week of the eight-storey tower at 179 St George’s Terrace by its WPVAT II fund, using 100 per cent equity from the fund.
Located on a 787 sqm site on the corner of St George’s Terrace and Mercantile Lane, the off-market sale of 179 St George’s Terrace was brokered by Colliers International’s Wayne Lawrence and Tory Packer.
Warrington Property, a strategic value investor that identifies and invests in undervalued property in key growth markets across Australia, paid $18.25 million for the B-grade, 4,164 sqm building which was left with a high vacancy after the departure of former tenant Rio Tinto.
Warrington Property intends to replicate the leasing success it achieved at 66 Kings Park Road in West Perth, which was also purchased with a low occupancy and is now close to being fully leased after an extensive refurbishment.
The vendors of 179 St George’s Terrace were private offshore investors.
Colliers International Head of Investment Services Wayne Lawrence said the investment focus in Perth had broadened to include office buildings with value-add potential.
“Demand is still strong for leased office assets but with confidence gradually returning to the leasing market, there is also an appetite to purchase buildings with high vacancies and good leasing prospects,” Mr Lawrence said.
The building has a modern lobby and side core floor plates of around 420 sqm on the lower levels and 570 sqm on the upper levels. It also has three facades of unobstructed natural light and a basement with 16 car bays.
Ms Packer said 179 St George’s Terrace enjoyed a prime location in Perth’s CBD and Warrington’s refurbishment plans would restore and maximise its appeal to tenants.
“We expect ongoing yield compression and rental growth to be the drivers for office capital growth in Perth in the next few years,” she said.
Colliers International’s office leasing directors Daniel Taylor and Dustin May have been appointed to lease the building.