Centuria Office REIT achieves 12.5% premium on Chatswood divestment

9 Help Street office building sold above book value

• COF divests Chatswood office building for $90m
• Asset has been held since the REIT’s IPO, providing a c.12% IRR
• Divestment delivers a 109% capital uplift to unitholders

Australia’s largest listed pure-play office fund, Centuria Office REIT (ASX: COF), has exchanged contracts to divest a Chatswood office building for $90 million, a 12.5% premium to its 30 June 2025 book value.

Located at 9 Help Street, Chatswood NSW, the 9,397 sqm B-grade office has been part of the COF portfolio since its IPO in 2014 and the divestment reflects a c.12% IRR throughout the REIT’s ownership. The building is being acquired by a private investor.

Belinda Cheung, COF Fund Manager said, “This non-core divestment is reflective of a turning point in the domestic office market, illustrating improving investment appetite for well-located office assets and underpins COF’s Net Tangible Asset (NTA) backing.

“The asset was originally valued at $43 million when the REIT was listed in 2014, providing COF unitholders with a 109% capital uplift. The divestment is consistent with the REIT’s focus on strengthening its balance sheet while also improving portfolio quality.”

Jesse Curtis, Centuria Head of Funds Management, added, “In the past six to 12 months, we have seen an increase in transaction volumes across the office sector, especially within the Sydney market. This is in part attributed to a changing sentiment toward office off the back of increased office-based work driving tenant demand and limited near term office supply.

“The medium-term outlook for office looks particularly promising. Limits to delivering new office assets is compounding with office stock withdrawal, creating a substantial under supply of office space. Development feasibilities have become challenging with higher construction costs widening the gap between replacement value and prevailing valuations, which we believe will drive market rents. The amount of office space is also diminishing with the rising trend of secondary office assets converting to alternate use, such as apartment buildings, hotels, life science, education or build-to-rent projects.”

The sale of 9 Help Street is anticipated to settle in June 2026.