02/05/2011 - 09:38

Clough's former HQ hits market

02/05/2011 - 09:38

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Clough Engineering's old base at 251 St Georges Terrace is up for sale, with Jones Lang La Salle and Burgess Rawson jointly appointed to manage the transaction.

Clough Engineering's old base at 251 St Georges Terrace is up for sale, with Jones Lang La Salle and Burgess Rawson jointly appointed to manage the transaction.

The building is owned by property developer Hossean Pourzand and his wife Jenny, and was seized by receivers in the fall-out over the beleagured Raine Square development.

The nine-storey, 9,750 square metre building is located on what is becoming known as Perth's 'golden resources triangle', and presents significant investment potential, according to Jones Lang La Salle director of sales and investments, Nigel Freshwater.

"In the current environment, the building offers strategic refurbishment and repositioning opportunities considering Perth's reducing vacancy rate and the fact that some 3,500sqm is either currently vacant or will become available in the next 12 months," Mr Freshwater said.

"The building is primed for repositioning at a time when there is still considerable demand from tenants and the potential for strong rental growth."

Mr Freshwater said the building was estimated to generate a fully leased net income of around $6 million following upcoming rent reviews on all leases over the next 12 to 18 months.

Burgess Rawson director Rob Selid said the CBD office market had been tightening for the last 12 months, where only a handful of major buildings changed ownership.

"Prices in excess of $7,000/sqm are being achieved and with the tightening of the leasing market and increasing rents strong capital growth is highly likely," he said.

In the March quarter, Fortescue Metals Group, BHP Billiton, Rio Tinto and Argyle Diamonds all leased additional space, while net absorption exceeded 24,600sqm.

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