Centuria secures sales premiums in urban markets
Capitalises on demand for assets benefitting from urban regeneration
- South Eveleigh Office and Robina Childcare Centre, achieve 14% and 4.7% premiums1, respectively
- Private investors acquire commercial assets benefiting from regeneration, proximity to residences and education
- Centuria delivers on value-add strategies for unlisted funds’ unitholders
ASX-200 listed Centuria Capital Group (ASX: CNI or “Centuria”) has achieved above prior book value sales premiums1 for two urban assets in Sydney and the Gold Coast, respectively, which reflect strong demand for well located commercial real estate benefitting from urban regeneration and in close proximity to housing, schools and universities.
On Friday 21 April, contracts exchanged for The Belltower at 6 Cornwallis Street, South Eveleigh NSW for $18.25 million, reflecting a 14% premium1. The 1,148sqm2 office building benefitted from a recently completed, extensive refurbishment and was sold with vacant position.
The Belltower was originally constructed in 1887 as part of the Eveleigh Locomotive Workshop’s Manager Office, with the bell signalling the beginning and end of the railyard working day. In the early 2000s, it formed part of a wider regeneration masterplan, transforming the area into a technology precinct that is now occupied by the Commonwealth Bank, Channel 7, CSIRO’s Data61, Cicada Innovations, and the University of Sydney’s Institute of Agriculture and School of Life and Environmental Sciences.
On Thursday 30 March 2023, the Papilio Early Learning and Kindergarten-operated childcare centre at 60 Investigator Drive, Robina QLD property sold at auction for $8.8 million, reflecting a 4.7% premium1 to book value and a 21% premium to its 2020 purchase price. It is 100% occupied on a net lease term, with CPI-linked positive rent reviews3. The property provides a 12.8 year WALE4.
The childcare property is within the masterplanned Robina Health Precinct, benefitting from the Robina Hospital and Robina Town Centre’s retail and leisure precinct. It is also part of the southwest Gold Coast’s desirable school catchment being 80 metres from the Robina State High School and within proximity to other private and public schools.
Both assets were bought by private investors.
Ross Lees, Centuria Head of Funds Management, said, “Centuria has a long held investment strategy to secure well-positioned commercial real estate where value-add initiatives can be implemented to capitalise on excellent community infrastructure, public transport and road arterials.
“The South Eveleigh and Robina assets are exemplary of this strategy and further benefitted on long term regeneration programmes. These assets lend themselves to the work-live-play rhetoric, which we believe was appealing to their new owners.
“By achieving above book value premiums, we believe our value-add strategy has been successfully executed, creating value for our unlisted funds’ unitholders.”
The Belltower was part of Centuria’s unlisted, closed-ended Australian Technology Park (ATP) Fund, which still retains two office buildings within the technology precinct. The Fund originally acquired The Belltower in April 2016 for $3.3 million. Since inception in April 2016, ATP has provided a 238% total return5,6.
The Robina childcare centre was part of the Centuria Diversified Property Fund (CDPF), which is an open-ended unlisted fund comprising direct and indirect property investments, equities and cash or cash-like products. Since its inception in June 2016, CDPF has provided a 10.8% per annum total return5,7. Further information on CDPF’s historic performance over different time periods can be found on Centuria’s website.
Knight Frank’s Jonathan Vaughan and Tim Holtsbaum and Karbon Property Josh Watts and James McCourt were the appointed sales agents for The Belltower. Burgess Rawson’s Natalie Couper was the auctioneer for the Robina childcare.
Papilio Early Learning and Kindergarten-operated childcare centre, 60 Investigator Drive, Robina Qld
1. Above December 2022 valuation
2. Size by Net Lettable Area
3. Annual rent increases to the greater of CPI or 2.5%
4. Weighted Average Lease Expiry
5. As at 31 March 2023
6. Since its inception on April 2016, ATP has provided a 238% total return to investors based on distributions paid and the current unrealised gains in the portfolio’s book value and the realised gain of the South Everleigh sale. Performance is shown post fees and assumes distributions are re-invested. Past performance is not a reliable indicator of future performance.
7. CDPF’s performance refers to the performance of the Stapled Fund, CDPF and CDPF No. 2 consolidated. CDPF merged with Primewest Property Income Fund (PPIF) in November 2021. The performance includes capital gains as well as distributions paid. Performance is shown post fees and assumes distributions are re-invested. Past performance is not a reliable indicator of future performance. Prospective investors should review the full historic performance data for the Fund available on Centuria’s website.
Centuria Capital Group secures a $70.6 million industrial logistics facility in North Rocks, NSW, on behalf of US private investment firm, Starwood Capital’s, Last Mile Logistics Partnership (LMLP).
Centuria Capital Group has successfully exchanged conditional contracts to divest two adjoining industrial facilities located at 114 and 120 Old Pittwater Road, Brookvale NSW, which is anticipated to deliver a forecast 13.8% IRR to the assets’ closed-ended fund investors.