15/10/2014 - 14:49

Prime Albany Highway office building up for sale

15/10/2014 - 14:49

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Prime Albany Highway office building up for sale

Monadelphous Group’s Albany Highway headquarters has been put up for sale, with selling agent Colliers International expecting the building to attract an offer exceeding $75 million.

The Gateway Building, which is being offered for sale by Finbar Group, presents a unique opportunity for commercial investors, according to Colliers International director of investment services, Ian Mickle.

It was completed in 2010, while 90 per cent of the asset is taken up by Monadelphous on a lease extending through 2022.

“This is a top quality asset, newly completed and underpinned by a secure long-term lease to a blue chip national tenant,” Mr Mickle said.

“The location further adds to the value proposition – just minutes over the Causeway to the heart of the CBD, with views of the river and city, while sitting in a thriving retail, entertainment and commercial precinct in Victoria Park.”

Mr Mickle said the building produced an annual net income of $6.1 million, which would prove a strong draw for investors.

“We anticipate the current and future value offered by this asset will generate strong interest across the board, with potential buyers including offshore investors, syndicates and high net worth individuals,” he said.

“We would expect to see that level of competitive tension generate a strong price reflective of that value proposition.”

Offers to purchase close on November 4.

Finbar managing director Darren Pateman told Business News the company considered the timing was right to sell the asset.

"If we achieve a price that we are happy with, and maximises the shareholder benefit, then we are happy to sell and redeploy our equity in the property where we can generate a greater return within our core business," Mr Pateman said.

The building contributed 54 per cent of Finbar's rental earnings in the 2013-14 financial year, while rental earnings contributed about 5 per cent to the company's overall revenue.

Mr Pateman said additional income from Finbar's Pelago apartments in Karratha had already replaced and exceeded the Gateway Building revenue.

"In fact, the net returns are substantially greater for the company for the reason that the Gateway Building is geared and our Karratha asset is currently ungeared and wholly owned." 

 

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