Dexus divesting Canberra office after two decades

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DEXUS has officially listed for sale its remaining Canberra office asset, Garema Court, as it shifts focus to major developments along the eastern seaboard.

Located at 140-180 City Walk in the heart of the CBD, the seven level building of 10,820.8 sqm and is 100% occupied by the Commonwealth government on a lease running for another four and a half years with fixed rental increases of 4% per annum.

The building has a NABERS Energy Rating (with Green Power) of 5.5 Stars.

Colliers agents Paul Powderly and James Mitchell have been appointed to market Garema Court, via expressions of interest closing 14th November. Dexus has held the asset for nearly 20 years.

Paul Powderly of Colliers said investors would be attracted by the quality of tenant and Canberra’s exceptionally low A grade vacancy rate, which is currently at 1.7% in the CBD. Widespread interest is expected due to Canberra’s attractive yield spread versus other eastern seaboard markets.

Mitchell said Garema Court is in a prime position, directly opposite the city’s largest shopping precinct, the Canberra Centre and surrounded by stores, places to eat, banks, gyms and health facilities as well as the new ACT light rail stage one terminus and bus interchange.

“These are all positives for long-term tenant retention and demand for space in the building,” he said.

Garema Court is Dexus’s last in the national capital after its $62 million sale of the Finlay Crisp Complex earlier this year to Singapore-based SC Capital Partners, around the same time it divested another non-core asset, the A-grade three-building office complex at 11 Talavera Rd in Sydney’s north shore for $231.2 million.

Dexus has just entered into an agreement to buy 171 Edward St, in Brisbane CBD’s golden triangle precinct, for over $80 million from Aria Property Group. The site has approval for an 82-storey residential tower, and Dexus is reportedly considering a joint venture with neighbouring owner the Catholic Church.

It already has its $1.4 billion Eagle St Pier mixed use waterfront project in the pipeline, which will include two new towers.

Dexus acquired the remaining share the 67-level MLC Centre for $800 million from GPT earlier this year and has started an overhaul of the retail component. In Melbourne, it bought the 80 Collins St commercial development in a $1.476 billion deal, and last year paid $230 million for the corner site opposite, at 52 and 60 Collins St, with plans for a $650 million office precinct.

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