Super fund-backed manager ISPT, Aware Super and Lendlease are in sales mode

The industry super fund heavyweight is selling off two major blocks in Sydney as it reweights its portfolio.

ISPT is selling 100 Pacific Highway, North Sydney

Sydney office buildings are being chased by major investors with superannuation heavyweights looking to shift assets worth close to $650m as values stabilise.

In one of the largest moves, superannuation fund-backed manager ISPT is stepping up plans to sell off offices in Sydney, putting a long-held tower in North Sydney on the block that could reap about $220m.

The company has put 100 Pacific Highway up for sale for the first time since it was built in 2006 and hopes that it will transact amid a broader sell down by the manager. It is also selling a $90m tower in Smith Street, Parramatta, as investors seek out buildings that will deliver after the big reset in suburban office markets.

Few assets have traded, but buyers are warming towards the markets as some buildings are converting to residential holdings.

North Sydney has also been relatively quiet, with the market expecting larger assets to hit the market later this year.

Lendlease and Aware Super are selling Darling Square, Sydney

Development major Lendlease is expected to rekindle a process for its $1.5bn Victoria Cross over-station development in North Sydney once it secures more tenants. In 2023, it ran a process which drew strong interest from Japanese real estate developer Mitsubishi Estate, but that deal did not go ahead.

But ahead of making that move, Lendlease’s flagship office fund and the heavyweight Aware Super have put the Darling Square office development in Sydney on the block again. They have put the building housing the Commonwealth Bank on the market for about $350m.

The pair have tapped Flint Davidson and James Parry of CBRE and Luke Billiau and James Barber of JLL to sell the 12-storey campus-style facility in the Darling Harbour precinct that Lendlease developed, backed by the super fund. The agents and company declined to comment.

ISPT has tapped CBRE’s Flint Davidson, James Parry and Mitch Noonan and Cushman & Wakefield’s Josh Cullen, Steven Kearney and Kenny Duncanson to handle the North Sydney building.

Designed by Peddle Thorp Walker architects and developed by ISPT in a joint venture with Leightons, the asset has 21,879sq m of A-Grade office space on a large 2,680sq m site, with views over Sydney Harbour.

Mr Parry said the building was a rare 100 per cent freehold interest at an attractive price point in North Sydney. “The sub-market is benefiting from the flight-to-quality theme of suburban tenants relocating into the North Sydney CBD and this, combined with a muted supply pipeline for the balance of the decade, will result in strong rental growth for prime assets,” he said.

The opening of the Victoria Cross Metro Station last year has boosted access to the Sydney CBD.

Mr Kearney said the recently opened Metro Station had transformed North Sydney’s connectivity with the Sydney CBD. He said tenants were being drawn to the ever-improving amenity and accessibility. “Furthermore, buyers are increasingly being priced out of the Sydney CBD, making North Sydney a compelling investment proposition with enhanced returns,” he said.

Originally published as Super fund-backed manager ISPT, Aware Super and Lendlease are in sales mode