Germany’s Union Investment in Talks to Sell Brisbane Office Block for Reported $181M

Union Investment Real Estate is nearing a deal to sell its Southpoint office building in Brisbane for a reported A$255 million ($181 million) to a fund sponsored by Sydney meat magnate Paul Lederer, more than a decade after funding development of the asset. 

The sale price represents an initial yield of 7.8 percent for the 15-storey building at 275 Grey Street, which has direct rail access and sits across Brisbane River from the city’s financial district. With retail space on its lower floors, the building is anchored by long-term ASX-listed tenants Flight Centre and Virgin Australia, and has high efficiency ratings, according to LinkedIn posts from brokers at Savills and CBRE, which are marketing the asset on behalf of Union.

While Savills and CBRE brokers declined to comment on a report in The Australian on the discussions, market sources told Mingtiandi on Thursday that the parties are in due diligence for the deal. The Frankfurt-based investor said it would not comment on “market rumours,” when contacted by Mingtiandi. Lederer’s LDR Capital, which has begun raising funds to support the purchase, did not respond to a request for comment.

Southpoint is one of “only four institutional-grade office assets” in the Southbank area, according to marketing materials posted when the property went on the market two months ago, with the precinct being home to the Queensland Museum and Gallery of Modern Art, as well as to the South Bank Parklands & Streets Beach which fronts an artificial lagoon along the Brisbane River. 

Foray Into Australia

Union Investment bought the property in 2014 for A$200 million while it was still being developed, before completing the 28,150 square metres (303,000 square feet) project in 2016. At the reported pricing, Union would be selling at A$9,059 per square metre, according to Mingtiandi calculations, with vacancy in the tower at 2.4 percent, per marketing materials. 

Boasting views over the river and a 6.0-Star rating for its indoor environment under Australia’s NABERS ratings for sustainable buildings, Southpoint has 4,700 square metres of retail space on its lower floors, where it hosts supermarket operator Woolworths, as well as McDonald’s and pharmacy chain Terry White alongside other tenants. The building has a weighted average lease expiry of 8.4 years with Virgin’s tenancy expiring in 2030.

With 50.2 billion euros ($58 billion) in assets under management, Union chose Southpoint as its first investment in Australia, according to reports at the time, with the company listing the asset under its UniImmo: Europa open-ended real estate fund. The fund, which invests “primarily in commercial real estate in major European cities with sustainable economic development potential,” according to Union’s website, has assets of 10.3 billion euros, trades on the Frankfurt exchange and fell almost 11 percent over the year through 30 April 2026.

 

The fund said on 18 May 2026 that it had cut its US exposure with the sale of a shopping centre in Palm Beach County, Florida for an undisclosed price. 

 

In Asia Pacific, Union Investment in 2024 sold a pair of Tokyo office buildings for nearly $300 million, after holding the assets for more than nine years. The only other APAC property listed on Union Investment’s website in Asia Pacific is a 12,462 square metre office building at 155 Clarence Street in central Sydney.

 

Raising Money

LDR Capital is working to raise capital from high net worth individuals to fund its Southpoint acquisition, according to reports, the details of which were corroborated by a market source who spoke with Mingtiandi. 

 

Lederer, the founder of meatpacking firm Primo Group and a co-owner of the Western Sydney Wanderers football club, in 2025 took over Elanor Commercial Property Fund, before renaming the vehicle as LDR Capital Property Fund. 

 

With a fortune estimated at A$2 billion by Australian wealth ranker The List, Lederer is taking a 25 percent stake in the Southpoint acquisition fund, with the goal of flipping the building before the Brisbane Olympics in 2032 in anticipation of rising demand for office space in the run up to the event as high development costs restrict new projects. 

 

The billionaire announced his intentions to build up a new property portfolio in December 2025 with his A$305 million purchase of the former Sirius Building in Canberra, with LDR Capital primarily investing in the office, industrial, health and retail sectors.