SG’s Rockworth Capital Buys Brisbane Building for Over A$60M

Singapore’s Rockworth Capital has added to its portfolio of Australian real estate assets with the purchase of 100 Edward Street, a grade B office asset in Brisbane for a sum of over A$60 million ($44.4 million), according to an announcement late last week by the boutique real estate fund manager.

Rockworth is buying its fourth property in Australia’s Queensland state, a 17-storey office block near the upcoming Queen’s Wharf and Eagle Street Pier projects at the intersection of Edward and Mary Streets in Brisbane’s ‘Golden Triangle’ financial district, from a local investment partnership managed by Evolution Private via an off-market transaction.

Following the acquisition of the tower fomerly known as the ING Building, Rockworth will have a portfolio of 14 Australian properties, as commercial assets in the antipodes continue to gain in popularity with Singaporean investors.

Adding Value to a Grade B Office Building

“The acquisition is a timely opportunity to participate in a fast-evolving gateway city in Australia, with a strategically located asset at the centre of major rejuvenation and infrastructure projects,” Rockworth’s chief executive officer Lim Kin Song said in a statement. The former investment manager with Ascendas REIT added that the building’s recent refurbishment and above average occupancy, compared to other B-grade properties in Brisbane, give private equity investor opportunities to enhance rental income.

This latest deal gives Rockworth its first office asset in Brisbane after the firm had previously acquired three retail properties in the suburbs of the Queensland capital. The seven-year-old company also previously acquired the 50 Margaret Street office tower in Sydney for A$65 million, and the fund manager also has office properties in Melbourne and Perth.

Hot Office Market Helps Drive Brisbane Transaction

Rockworth’s new downtown prize provides it with 7,120 square metres (76,600 square feet) of office space over a 1,400 square metre freehold site. Dutch bank ING was formerly a principal tenant of the 17-storey tower, which according to a recent listing by Colliers International, has recently undergone a lobby refurbishment and façade upgrade.

Net effective rental rates for grade A office space in Brisbane’s central business district averaged A$430 per square metre per year during the second quarter of 2018, according to data from property consultancy Savills, and the property includes 109 car park spaces and retail space on the ground floor.

“100 Edward Street has been a leasing success with 25 tenants currently occupying around 95% of the building,” Evolution Private principals Rob Carter and Mark Russo commented in the statement. The Brisbane-based firm purchased the building for A$46 million in 2011.

Singaporeans Keep Buying Up Australia

In its statement, Rockworth made clear that it remains enthusiastic about opportunities in Brisbane, as Singaporean investors continue to rank among the top buyers of commercial real estate assets in Australia.

Just two months ago, Singapore-based real estate investment shop ARA Asset Management bought a A$405.9 million (then $317 million) stake in ASX-listed Cromwell Property, creating a local Australian platform for John Lim’s Warburg Pincus-backed firm.

That investment came one year after funds managed by ARA teamed with fellow-Singaporean investment firm Straits Real Estate to buy the 320 Pitt Street office tower in Sydney for A$275 million.

In August of last year, developer Ascendas-Singbridge, which is backed by Singapore’s Temasek Holdings and JTC Corporation, bought 66 Goulburn Street in Sydney for S$252 million and then in December last year Ascendas REIT, which is managed by a unit of Ascendas-Singbridge, acquired a suburban office property in Queensland for A$106.2 million.