Costa offloading Geelong office after successful repositioning

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COSTA Asset Management is hoping for more than $17 million for a fully occupied Geelong office building it has refurbished and re-leased over four years.

Centrally located within the medical and professional services office precinct of the Victorian city, the three-level building has 2,622 sqm of net lettable area plus a single level of secure basement parking.

Since acquisition in 2018, Costa Asset Management has refurbished the property and set about a leasing program. The building is now fully leased with a net income of just under $1 million per annum and has a weighted average lease expiry of about five years.

Colliers’ Jonathon Lumsden, Andrew Lewis, Peter Bremner and Ben Baines alongside Pat Burke of MP Burke Commercial have been appointed to sell 235 Ryrie Street by expressions of interest closing 19th May.

“Once refurbished and having secured leading accounting firm Findex on a new 10-year lease this is now the right asset, in the right market for investors seeking a solid, high performing investment,” Burke said.

A new lease has been signed with Nucleus Network Australia’s largest phase one clinical research company, while long-term tenants Clinical Laboratories and Coulter Legal have extended their leases over the past two years.

Lumsden said the building provides a “set and forget” investment with scope for further upside with a full scheme previously approved for two additional levels, including activation of the rooftop area.

Geelong experienced almost 4% population growth from 2019 to 2020 with a large number of residents relocating from the cities. Only Gold Coast and Sunshine Coast attracted more sea-changers from the city than Geelong in the period. Its population is estimated to hit 500,000 people by 2047.

Costa Asset Management and joint venture partner Brix Property Group last year bought a 1.9-hectare industrial site in the eastern Melbourne suburb of Bayswater for $7 million in a sale and leaseback deal with RUAG Australia, and 6.65-hectare industrial parcel in the south east’s Seaford for $19 million.

They are also developing a service station in Geelong’s Charlemont.

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