China’s Aqualand Takes Aim at $128 Mil Office Tower for Latest Sydney Deal

Continuing on its North Sydney spending spree, Chinese-backed developer Aqualand is said to have entered into a conditional agreement to buy the 19-storey Fujitsu Centre from local developer Denwol Group for around A$168 million ($128 million), pending the government-owned RailCorp’s consent to transfer its leasehold interest, according to The Australian.

The purchase would mean a windfall for Denwol Group, which bought the circa 1975 building from Canada’s Brookfield in 2014 for just A$89.15 million ($68.1 million). The 15,880-square-metre building at 15 Blue Street is located above the North Sydney railway station.

The announcement of this conditional deal comes just weeks after Aqualand – which is a subsidiary of Shanghai Shenglong Investment – closed on its A$140 million ($106.9 million) acquisition of the former Samsung office building in Sydney’s Milsons Point, a deal which was originally announced last year.

In October last year the developer agreed to acquire another office tower in North Sydney, putting down A$70 million (then $53 million) — nearly double the price its owner had paid just two years earlier — to take possession of a 16-storey structure at 132 Arthur Street.

Aqualand’s Sydney Spree Continues Despite Doomsaying

Founded in just 2014, Aqualand has already acquired more than ten development sites in Sydney in its short history, with its first project, Lindfield Village, having been launched in February of 2015.

The company run by Jin Lin, song of Shenglong chairman Lin Yi, is taking a bullish stance on Aussie housing despite widespread predictions of a slowdown in Australia, particularly in Melbourne, Brisbane and Sydney, where a surplus of new projects is causing concern.

Also this month, BIS Oxford Economics managing director Robert Mellor said that the four-year property boom Sydney has experienced is expected to decline starting in mid-2017, a correction that will see house prices in Sydney drop by five percent over two years.

Betting Big on Barangaroo

Despite the predicted downturn, what may turn out to be Aqualand’s largest project to date is still in the works. In a consortium with Australia builder Grocon and shopping centre enterprise Scentre, the trio are tipped to win a bid to develop a A$2 billion ($1.5 billion) project in Sydney’s Barangaroo.

The 5.2 hectare Central Barangaroo development project involves about 150,000 square meters of new residential, retail and commercial space. The bid from the three is said to be a favorite because it would blend more effectively with the nearby $2 billion hotel and casino, Crown Sydney.