Singapore-based real estate private equity firm SC Capital Partners has sold an office tower in Sydney to Poly Australia, the Australian arm of Shanghai-listed Poly Developments, for A$270 million ($182 million), according to an announcement.
The property at 59 Goulburn Street is a 26-storey tower that has 19,470 square meters of net lettable area with an average floor plate of 845 square meters.
SC Capital Partners, through its Real Estate Capital Asia Partners (RECAP) IV fund, and Fortius Fund Management jointly acquired the property in 2017 for A$158 million ($106 million). The partners then significantly upgraded the office tower, which was built in 1973.
The property has prior approval for redevelopment into a 38-storey tower with 407 hotel suites and 90 residential units, retail, and office spaces. However, Poly Australia said it does not plan to pursue redevelopment at this time.
Instead, Poly plans to rejuvenate the property, including the potential for the revitalisation of the retail precinct, end-of-trip facilities, tenancy upgrades, and the introduction of public flexible workspaces, among others.
Ashwin Arumugam, Poly Australia’s senior analyst, said the acquisition highlights a shift in strategy for the global real estate business that announced the new venture into asset management and real estate finance back in 2019.
“We are proactively looking for the next opportunity as part of our accelerated growth plans across Australia, with the exploration of prospective acquisitions in leading locations across Brisbane, Sydney, Melbourne and Adelaide as we continue to expand our asset management portfolio,” he said.
Goulburn Street, Arumugam added, is an example of the types of property that Poly Australia is looking to acquire as it broadens its portfolio. It also joins premium global asset 5 Fleet Place, London, in Poly’s Capital Markets portfolio.
Poly Australia is the Australian division of the listed international property development company, Poly Development and Holdings. The Shanghai-listed firm entered Australia in 2015 with acquisitions in Melbourne and Sydney.
The deal comes after SC Capital Partners reached an agreement to acquire Two Wentworth Street, an office tower in Parramatta’s central business district, for A$105.3 million (nearly $72 million) in December.
The office tower is located within Sydney’s second-largest employment destination with strong occupier demand, SC Capital Partners said in a statement.
In November, the Singapore firm also acquired a property asset in Australia from Malaysia-listed real estate company UEM Sunrise Bhd for A$107 million ($72.6 million). SC Capital Partners has fully acquired the property through its Australia-registered entity, RECAP V.
RECAP V closed in May 2019 with total commitments of $850 million. The fund started raising capital in August 2017 with a $1 billion target.