The building, which houses ACT Health’s headquarters in Woden, has changed hands for $ 84.6 million, underscoring the strength of Canberra’s office market and the attraction of the growing city center.
The ASX-listed real estate investment fund Growthpoint has acquired the six-story office building at 2-6 Bowes Street from private equity investment group Altis Property, which had owned the property for four years.
Altis had paid Quintessential Equity $ 58.4 million for the 4,366-square-foot plot. Quintessential picked it up for $ 14 million in 2012, then underwent a $ 10 million renovation and leased nearly 90 percent of the property to ACT Health.
The property was developed in 1986 and has 12,376 square meters of rental space spread over three contiguous buildings and 86 basement parking spaces.
ACT Health has 9.2 years left on its lease, after which it will be presented with the first of two five-year options.
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The federal government, including its COVID response team, occupies 940 square feet (or 7.6 percent).
Collier’s International Director of Capital Markets and Investment Services, Matthew Winter, said Woden’s reputation as a national health center and the strong development prospects of the city center contributed to the outcome.
“The acquisition of 2-6 Bowes, and also (the sale of) Scarborough House (for $ 83 million) earlier this year, shows confidence in the Woden market and its ongoing development,” he said.
“The compelling infrastructure history provides a positive long-term outlook for the area.”
Winter said key infrastructure such as Canberra Hospital, Westfield, future CIT campuses and major residents, including the Department of Health, and the ACT government, supported the area.
“The ACT Government’s commitment to major infrastructure projects to improve the development of Woden as well as the private sector provides a compelling investment proposal,” he said.
Winter said the sales campaign attracted strong domestic and international interest given the quality of the asset and income profile.
“The ACT office market has experienced record levels of buyer participation and sales volume in 2021,” he said.
“In July 2021, ACT had the lowest overall unemployment levels of a large Australian office market (7.7 per cent). Vacancy levels for Class A office assets are approaching historic lows across the entire ACT market.”
Sir. Winter said the Woden A-grade market had been one of the most stable in the entire ACT.
Growthpoint now owns $ 261 million in Canberra properties. Sir. Winter said the company had been a long-term Canberra owner, and this recent acquisition underscored its continued confidence in the market.
Colliers and CBRE mediated the sale.