50 Marcus Clarke Street Canberra
The 50 Marcus Clarke Street office building is among Canberra’s most energy efficient buildings. Image supplied.
  • The 12-storey 50 Marcus Clarke office building, constructed in 2011, was acquired for $335 million
  • The joint venture between GIC and Charter Hall marks latest partnership in 15-year relationship
  • Acquisition is latest in several Canberra office sales, with investment activity on track to set new record

A prominent Canberra office building has sold for $335 million to a joint venture between GIC and Charter Hall.

Singaporean sovereign wealth fund GIC will acquire a 95% interest in the 50 Marcus Clarke Street property. The remaining 5% interest will be acquired by property investment and funds management company Charter Hall.

The sale was negotiated by CBRE agents Michael Andrews and Nic Purdue.

Charter Hall attracted by sustainable drawcards

The Marcus Clarke Street property is located in the heart of Canberra’s CBD with exceptional access to amenities and public transport.

Developed in 2011 by the Walker Corporation, the building has only had two previous owners with the last sale finalised in 2017 for $321 million.

The building is currently tenanted by the Department of Education, Skills and Employment on a 15-year lease ending 2025.

The 12-storey office building boasts over 40,000sqm of net lettable area. It is also among Canberra’s most energy efficient buildings, with a 5.5 star NABERS energy rating and a 6.0 Green Star rating.

Charter Hall Office CEO Carmel Hourigan cited the building’s sustainability credentials as a drawcard for the investment company.

“50 Marcus Clarke is a well-located, modern asset that meets our high standards for sustainability and aligns well with our strategy of acquiring properties leased to high-quality tenants.”

Carmel Hourigan, Charter Hall

“It provides a flexible, future-focused and agile work environment, which
will help the public sector maintain an engaged, productive and healthy workforce,” said Ms Hourigan.

Latest joint venture in 15-year relationship

GIC Chief Investment Officer of Real Estate, Lee Kok Sun, said GIC is pleased to be entering into a joint venture with Charter Hall to acquire the iconic Canberra building.

“This acquisition will add to the diversification of GIC’s office portfolio across key cities in the Australian market where GIC has been investing in for many years.

“With the opening of our Sydney office, we look forward to supporting the management of this asset and to generate more value-add with partners, such as Charter Hall,” he said.

Lee Kok Sun GIC
Lee Kok Sun, GIC Chief Investment Officer of Real Estate. Image – LinkedIn

Charter Hall Managing Director and Group CEO David Harrison expressed similar sentiments on working with GIC and the Australian Government.

“This strategic acquisition further strengthens our 15-year multi-sector relationship with GIC and reflects our strong market position and continued conviction for office assets with strong underlying investment fundamentals.

David Harrison, Charter Hall

“We are also pleased to advance our relationship with the Australian Government as a major tenant customer, and further increase our exposure to Canberra’s growing office market as our Office portfolio in Canberra approaches $1 billion,” said Mr Harrison.

Standout Canberra office market

The 50 Marcus Clarke acquisition is one of numerous high value commercial sales in Canberra this year, showcasing strong market conditions.

CBRE’s Michael Andrews described Canberra as a standout office market and said market activity is expected to hit a record-breaking point.

“We are currently tracking $1.17 billion in total office sales, which has completely eclipsed the decade average of $375 million, with another $300 million in sales in the pipeline.

“This coincides with Canberra recording its lowest vacancy rate since 2012 amid ongoing confidence in the local economy, despite the backdrop of COVID-19,” said Mr Andrews.

GIC Co-Head (Asia ex-China) of Real Estate, Kishore Gotety, said GIC have high confidence in the Marcus Clarke investment due to the stability of Canberra’s office market and continually strong tenancy demand.

“The Canberra market has performed well during COVID, with continued macroeconomic growth and low office vacancy.

“Going forward, we expect steady office demand, underpinned by healthy employment growth and government demand,” Mr Gotety explained.

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