Joint venture snares Zenith

21 May 2016

Publication: Australian Financial Review (print)

Date: 21 May 2016

Author: Nick Lenaghan

Centuria Group has teamed up with global giant BlackRock to acquire the Zenith office towers on Sydney’s north shore for $279 million from their co- owners Dexus Property Group and the GPT Wholesale Office Fund.

Centuria has already begun preparing an unlisted syndicate to hold the property through the Centuria Zenith Fund, which has forecast a distribution yield of 7.6 per cent in 2017.

Centuria will hold its 50 per cent stake in the unlisted fund – for which the minimum investment is $50,000 – while its co-investor BlackRock will hold its half share separately.

Centuria’s unlisted funds arm has been busy in recent weeks, closing over- subscribed in a raising for the fund that holds its $104 million portion of Sydney’s Australian Technology Park.

“We’ve had huge demand for our unlisted funds. It’s been fantastic,” said Jason Huljich, who heads Centuria’s unlisted funds arm.

The two 21-storey buildings at 821 Pacific Highway have a net lettable area of 44,000 square metres. CBRE and Savills handled the sale.

The Zenith is the third asset recently sold by GPT’s wholesale office fund. Fund manager Martin Ritchie said he would look for opportunities to redeploy the capital.

For Dexus, the $139.5 million for its share represents a 7.1 per cent premium to the asset’s book value.

Chief executive Darren Steinberg said the group had divested $350 million in assets so far this year as the group focuses on its core markets.