16 June 2022

Key city office building sells for record $335 million

| Ian Bushnell
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50 Marcus Clarke Street

50 Marcus Clarke Street in the city currently houses the Department of Education, Skills and Employment.

A key city office building housing a major federal department has been sold for a record $335 million.

Charter Hall, in partnership with Singapore sovereign wealth fund GIC, has added 50 Marcus Clarke Street to its growing portfolio of Canberra office properties.

South Korean fund manager Mirae Asset Global Investments bought the property for $321 million from Singapore-based CIMB in 2017.

The 12-storey building with 40,000 square metres of lettable space currently houses the Department of Education, Skills and Employment, but it is actively looking for a new, bigger site to accommodate all its staff when the lease expires in 2025, a factor that influenced the result.

Walker Corporation developed the site a decade ago and sold it to CIMB in 2012 for $232 million.

The sale is subject to approval by the Foreign Investment Review Board.

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In August, Charter Hall shelled out $98.5 million to acquire the Services Australia building in Forrest from Canberra-based property developer Doma Group.

At the time, Charter Hall said the off-market purchase of the Doris Blackburn Building on Canberra Avenue aligned with its strategy of acquiring properties leased to high-quality tenants on long-term leases that meet high sustainability standards.

In May, it paid $306 million for the Services Australia building in Tuggeranong from South Korean group AIM Asset Management.

The latest deal means close to $900 million of investment-grade Canberra offices have passed hands this year, showing the demand for A-grade, high-quality space, particularly with long-term government tenants.

In June, Blackstone acquired 38 Sydney Avenue, Forrest, for $73.75 million.

In July, 9 Brisbane Avenue sold for $60.5 million and Scarborough House for $83 million.

In August, Molonglo Group paid Cromwell Group $80m for 33 Allara Street in the city, while Real Asset Management acquired the seven-storey office building at 19-25 Constitution Avenue for $115 million from Lendlease’s Australian Prime Property Fund.

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