- The occupancy rate for the tower has increased from 46.6% to over 90%
- Will deliver a distribution of 8.15% in its first year, says Quanta CEO
- Property Council data shows the vacancy rate for similar assets in Brisbane is at its lowest in 10 years, despite Covid
Quanta Investment Funds, an Australian property investment group, has announced the acquisition of a recently-refurbished Brisbane office asset from Anton Real Estate Partners for $39 million.
The bid for 157 Ann Street was bolstered by significant new lease agreements which took the occupancy rate of the office tower from 46.6% to over 90%, with passing yield rising from 3.47% to 8.91%.
The new leasing included a 2,700 sqm deal with EMF Sports Performance and Recovery Centre, with plans for their Brisbane flagship health centre next year.
The second acquisition under the group’s new brand, Quanta CEO Stacey Jones said the tower was a strong fit with the growing portfolio strategy of Quanta.
“Investor support was strong for this strategic opportunity, which was fully subscribed within 12 days; and will deliver a distribution of 8.15% in its first year,” said Mr Jones.
“We are thrilled to provide 2,700sqm to EMF, a national success story who are leading the way in health and recovery.
“With fit-out designs and planning for their flagship wellness, fitness, performance and recovery centre well underway, this will bring new amenity to the Brisbane CBD.”
Stacey Jones, Quanta CEO
High demand for sub-$100m office assets
The refurbishment, which coast $7.8 million, was crucial in attracting tenants and included lift and foyer upgrades along with on-floor work improving the amenities.
Anton, led by principals Tony Martin and Anthony Kinglsey, acquired the property in 2013 as a risk-adjusted high-yield asset play with BCC being the anchor tenant.
Located between the two transport hubs of Central Station and King George Sound interchange, the 6,576 sqm tower is targeting the sub-500-square-metre, fitted-suite market, the most active tenant base in the city.
Adelaide O’Brien and Jack Morrison of CBRE managed the sales campaign jointly with Jason Lynch of Colliers.
Ms O’Brien said the sale comes amid a flurry of middle-market transactions in the CBD, highlighting liquidity in the sub-$100-million-landscape.
“While market fundamentals have become more challenging over the course of the year, groups with conviction around the occupier market are proving to be rewarded,” Ms O’Brien said.
“Data from Property Council of Australia has shown we are experiencing the lowest vacancy rate since 2012 in the CBD B-Grade market at 11.5%, demonstrating demand for quality, yet affordable accommodation, largely driven by SMEs.”
Mr Lynch added that the SME occupier market has performed strongly so far in 2022, with 67% of all CBD lease transactions less than 500 sqm and a further 85% of all leasing deals being less than 1,000 sqm.
“Notably, there was significant buyer depth in the sales campaign, with offers received from both domestic and offshore capital. In 2022 (year-to-date), there have only been two institutional quality office transactions in the sub-$100 million price bracket within the Brisbane CBD – including 157 Ann Street.”
