AFIAA: Acquisition in Melbourne
The AFIAA Investment Foundation for Real Estate Investments Abroad acquires an office building in Melbourne, Australia, for 161.5 million Australian dollars, the equivalent of around CHF 122.5 million.
The property changed hands as part of an asset deal; the seller is the globally active real estate investment company Straits Real Estate Ltd. from Singapore.
The office building is located at 114 William Street in a prime location in Melbourne's central business district. It was built in 1976 and has been modernized several times, most recently at the beginning of this year. The 23-storey building comprises around 21,000 square meters, of which around 97 percent is office space and around three percent - the lower floors - is retail space. The main tenant is Hostplus, one of Australia's largest pension funds. The fund manages money from the hotel and tourism industry.
AFIAA sees further potential for rental growth in very good locations in Melbourne and is therefore continuing its search for suitable buildings, says Jürg Erismann, AFIAA's asset manager in Sydney. This also applies to Sydney, where AFIAA has also been invested for several years.
The positive trend on the office markets is also confirmed by studies by JLL. According to this, demand for office space in Melbourne has been rising for ten quarters in a row, which is reflected in the high absorption of space. The vacancy rate has fallen continuously since 2013, while rents in central locations have risen steadily over the same period.
The property in Melbourne will be transferred to the AFIAA Global fund. In Australia, the fund holds real estate in the cities of Sydney and Brisbane in addition to another property in Melbourne. In total, AFIAA Global currently has real estate assets of around CHF 1.5 billion. Around 46 percent of the portfolio is located in Europe, 30 percent of the properties are in North America and a further 24 percent in Australia.
AFIAA intends to expand its portfolio to up to CHF 3 billion over the next few years. "The focus will be on core-plus investment properties in very good locations in Europe, North America and Australia," says AFIAA CEO ad interim Dr. Stephan Kloess. According to him, potential acquisition properties may also have potential in the tenant structure, such as vacancies, or require refurbishment. AFIAA can leverage this through active asset management in order to secure or increase long-term returns. (ah)
