18 August 2021

Doma sells Services Australia building in Forrest for $98.5 million

| Ian Bushnell
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Doris Blackburn Building, Forrest

The Doris Blackburn Building at 18 Canberra Avenue, Forrest, is leased to Services Australia. Photo: Doma Group.

Canberra-based property developer Doma Group has cashed in on demand for secure office investments by selling the Services Australia building in Forrest for $98.5 million.

National property giant Charter Hall has added the purpose-built Doris Blackburn Building on Canberra Avenue to its portfolio, saying the off-market purchase aligns with its strategy of acquiring properties leased to high-quality tenants on long-term leases that meet high sustainability standards.

Doma completed the 9568 square metre A-Grade office building in 2012 and the Department of Human Services moved 600 of its staff there in 2015 on a $100 million, 15-year lease.

The four-storey building, designed by Colin Stewart Architects and May + Russell, has a 5-star NABERs energy rating and a 5-star Green Star rating and is ideally located close to Parliament House.

Services Australia already has links with Charter Hall, from which it has leased a new $450 million complex in Adelaide’s CBD.

The Canberra property is one of two office buildings Doma has sold to Charter Hall for a total windfall of $245 million.

The other is in Newcastle where it is part of the revitalisation of the CBD waterfront precinct.

Doris Blackburn Building

Inside the Doris Blackburn Building. Photo: Doma Group.

Doma General Manager of Development, Gavin Edgar said the recently completed 15,500sqm office building at 6 Stewart Avenue was now Newcastle’s largest A-Grade office building and leased long-term to the NSW Government.

“It is surrounded by residential and infrastructure development, including the new Newcastle bus interchange,” he said.

“The property is targeting a 5-star NABERS Energy rating, 4-star Water rating, and a 5-star Design and As-Built Green Star rating.”

Colliers International handled both off-market sales and its State Chief Executive Paul Powderly said both assets presented extremely appealing investment opportunities, particularly as they are underpinned by long-term government tenants.

Colliers Director of Capital Markets, Matthew Winter said Canberra and Newcastle had performed strongly through the pandemic and current fundamentals indicated this trend was likely to continue.

“The sale demonstrates that investors continue to recognise the value of assets in defensive and emerging markets,” he said.

“We have witnessed exceptional appetite for government-leased opportunities and the off-market sale of these assets reflects the underlying demand for buildings with excellent tenant covenant.”

Mr Winter said both Canberra and Newcastle were benefiting from the population shifts as people move to work outside the major capitals.

“The recently released Australian Property Council Office Market Report found the ACT has the highest net demand of any commercial leasing sector in Australia and its lowest vacancy rate in over a decade,” he said.

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