Aspen sells Septimus Roe for $91m

Aspen Group has made more progress in selling off its commercial portfolio, offloading its highest value asset - the Septimus Roe office tower on Adelaide Terrace - to Singaporean development giant Far East Organisation.

The developer and fund manager said it had signed an unconditional contract to sell the property for $91 million.

Aspen bought the building for $28 million in 2002 from another Singaporean company, Ricass Holdings, which took 20 per cent of the agreed price in newly issued Aspen scrip at the time.

Knight Frank managing director John Corbett confirmed the buyer as Far East Organisation, which has spent between $600 million and $700 million over the past year buying up Australian property assets, including the Harbour Town shopping centre, for which it paid $205 million late last year.

The sale was brokered jointly by Knight Frank and Colliers International.

Mr Corbett said the Septimus Roe sale underlined the strength of demand from offshore investors, particularly from Singapore and China.

"We've got about 12 groups of big size looking for major Australian investments," Mr Corbett told Business News. 

"They're looking at offices, development sites, shopping centres and hotels, it's right across the board."

He said Knight Frank would release more details over the next few weeks concerning "three or four" significant transactions involving offshore investors.

The Septimus Roe transaction follows Aspen offloading its 50 per cent stake in Adelaide’s Australian Tax Office building early last month for nearly $30 million.

Aspen now has two assets remaining in its commercial and industrial portfolio - an industrial site on Phoenix Road in Bibra Lake worth $82 million, and an office and warehouse facility at 215 Browns Road in Noble Park, Victoria, which is worth $23.5 million.

Chief executive Clem Salwin said the sale of the Septimus Roe tower was an important milestone in the company’s efforts to restructure its business and reduce debts.

“Following the recently announced sale of Aspen Group’s interest in the ATO Adelaide, Septimus Roe is the next largest asset in the portfolio,” Mr Salwin said in a statement.

“With these sales we are methodically progressing with our strategic plan.

“The majority of proceeds are expected to be utilised for debt reduction, however we will also look to commence capital management initiatives, as well as potential reinvestment of capital in the business.”

At 9:30AM, WST, Aspen shares were up 5.2 per cent, trading at $1.30.