Dorado buys Northbridge office for $24.2m

Investment house Dorado Property has acquired the office building at 12 Newcastle Street in a deal worth $24.2 million.

Anchor tenanted by Fortune 500 company Compass Group, which trades in WA as facilities management business ESS Support Services Worlwide, the four-storey building is located in an area that has attracted significant interest from developers in recent years, with about $500 million in projects completed or under construction in the past 24 months.

Developments in close proximity include major apartment projects by Blackburne and Stirling Capital, a pair of student accommodation facilities, and NEXTDC’s P2 data centre, which is being built by Multiplex.

Compass Group, which accounts for 58 per cent of the 4,637 square metre building, holds a 10-year lease, while the building's weighted average lease expiry is 5.7 years.

The deal was brokered by CBRE’s Kate Foley and Ben Younger, while the vendor's identity was not disclosed.

Dorado’s David Giles said the company believed the asset had strong investment fundamentals, particularly with Perth’s office market continuing to improve as vacancies decline.

“We believe the asset will benefit from outsized rental growth as the CBD continues to expand northwards, and the difference in rental values between the CBD and fringe areas decreases over time,” he said.