Metro And Sim Lian Jv Acquire Sydney Office Building A1964 Mil
Singapore-listed Metro Holdings and Sim Lian Group have embarked on a joint venture to purchase a freehold office building in Sydney, Australia. The agreement, worth A$196.4 million ($172.3 million), will see the companies jointly acquire 1 Castlereagh Street.
Located in the financial hub of Sydney’s CBD, the 27-storey building boasts a prime location next to the recently opened Martin Place railway station. The property, which underwent refurbishment in 2021, has also been awarded a 4-star NABERS (National Australian Built Environment Rating System) rating. Its versatile floor plan, with no columns and the ability to be divided, caters to tenants of various sizes.
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1 Castlereagh Street offers a total net lettable area (NLA) of 12,418 sqm (133,667 sq ft) and currently has an 85% occupancy rate. The weighted average lease expiry (WALE) by income stands at approximately three years.
“This is a rare opportunity to acquire a prime, freehold office property in the highly sought-after core precinct of Sydney’s CBD. The area continues to attract tenants due to its prime location and high-quality amenities,” says Metro Group CEO Yip Hoong Mun.
This is the 18th property acquisition for the joint venture partners, with 1 Castlereagh Street being their fifth office asset in Australia. Sim Lian holds a majority 70% stake in the joint venture, while Metro holds the remaining 30%. Metro’s capital commitment for this investment amounts to A$30.8 million, which will be financed mainly through internal funds and external borrowings.
The joint portfolio currently comprises 17 freehold properties, boasting an average occupancy rate of 94.1% and a WALE of 5.6 years as of March 31. Upon completion of the latest acquisition, the companies will own a total of 18 assets, including five office buildings and 13 retail centres across New South Wales, Victoria, Queensland, and Western Australia. The joint portfolio is appraised at A$1.374 billion ($1.206 billion) and has a combined NLA of 176,227 sqm (about 1.9 million sq ft).
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