The Black Stump building on Grenfell St attracts $134 million price tag
Singaporean group Soilbuild REIT has acquired the tower, its third major property investment in Australia and second in South Australia.
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A Singaporean investment group has splashed out more than $134 million on the “Black Stump” office tower in the Adelaide CBD.
The $134.22 million acquisition by real estate investment trust Soilbuild REIT represents the group’s second major investment in South Australia and third in Australia.
Last year it paid $61.25 million for the Inghams processing plant at Burton in Adelaide’s northern industrial precinct.
The deal to acquire the Black Stump, at 25 Grenfell St, reflects a yield of 7.7 per cent and is the second highest price paid this year for an Adelaide office building.
It comes two and a half years after vendor Credit Suisse paid $125 million for the 24-level, 25,000sqm tower.
As part of the deal, Soilbuild has also agreed to pay an additional $5.07 million to secure an “incoming tenant” for the building.
The Advertiser understands that tenant is engineering group Aurecon, which has agreed to relocate to around 2500sqm in the building from May next year.
That agreement brings total occupancy to 88 per cent, with other tenants including PIRSA, Minter Ellison, Lipman Karas and JLL.
Soilbuild said major investments in defence, medical, roads infrastructure and renewables across South Australia were a key reason behind its decision to invest in the state.
“South Australia ... is currently in the early stages of some of the largest infrastructure investments in the country, with billions of dollars being invested in defence, medical, road networks, technology and renewable energy that is expected to generate significant employment in the long term,” it said.
“Adelaide is the second most liquid CBD office market in Australia between 2000 and 2018 and enjoys vacancy rates of less than 5 per cent in comparable grade A office towers located in Adelaide’s CBD.”
JLL and Knight Frank closed expressions of interest in the building in April, when a price tag of close to $150 million was expected.
JLL state managing director Jamie Guerra said improved leasing activity and demand in Adelaide’s prime commercial market had generated confidence across interstate private investors, property funds and offshore groups.
“Soilbuild‘s announcement continues to demonstrate the Singaporean investment into Adelaide off the back of a record 2018 with in excess of $800 million of commercial transactions in the CBD,” he said.
Singaporean REIT Suntec’s $148.3 million purchase of Allianz Centre on Currie St is expected to settle in the coming days.
The Soilbuild deal is expected to settle in November.