Stamford Land Corporation is selling its Grade A office tower in Perth’s central business district for about A$140 million (S$179 million).
The 13-storey Dynons Plaza at Hay Street in Australia is now under construction and Stamford Land is “gearing up to place the asset on the market,” according to a report.
Some industry sources said that the building is worth A$130-A$140 million. The entire 13,000-sq-m office space will be leased by Chevron when it is ready for occupancy in the next few weeks.
“It is a new building, a quality long-term lease, so those sorts of assets are attractive to the market,” said Ian Mickle, director of investment sales at Colliers International.
The offer for the building is expected to be more than A$140 million. This could earn Stamford Land a considerable profit given that the total cost of buying, holding and developing for the property could be around A$80-A$90 million.
The Dynons Plaza is situated next to Woodside Plaza, which serves as the headquarters of Woodside Petroleum. The site of the property is part of a much bigger land parcel which the company had purchased in 1996 for A$20 million. Stamford Land has already sold the other parts of the land.
It was reported that Stamford Land had originally planned to construct a five-star hotel on the site, but it later developed an office block when there was no business case for a hotel.
The change seems to be working in Stamford Land’s advantage. The office building will be rented by Chevron for ten years, and the rental rates are set to increase every year. However, it is believed that Stamford Land will still sell the site to focus on its core business of operating luxury hotels.
The company owns and operates Stamford Hotels in Australia and New Zealand.