Mirvac exits Parramatta block as pipeline shrinks

The property developer has sold off another small site as it focuses on its larger, premium projects in Sydney.

Mirvac has sold 75 George Street in Parramatta.

Property developer Mirvac has quietly sold a small block in Parramatta, in Sydney’s west, that it once hoped to develop into an office skyscraper, in a $50m deal.

The developer offloaded the A-grade tower at 75 George St to the owner of a neighbouring shopping mall, with the off-market trade taking another mooted office development in the area off the table.

GPT’s flagship office fund sold a nearby site in Parramatta, where it had planned a $1.6bn office precinct, to developer Freecity, in another off-market sale last month.

Mirvac had picked up the block from funds house RF Corval for $86.3m in 2017. The A-grade twin tower spans six levels, and was fully leased at the time, though many tenants departed as Mirvac weighed up a development.

The site’s attraction was that it could have accommodated a 28,000sq m tower. But soaring building costs, rising interest rates and the tough market for tenant precommitments made getting a large project up difficult, and Mirvac had pulled back from some large-scale projects.

Under chief executive Campbell Hanan, it is now focusing its efforts on two other large projects in Sydney – the $2bn 55 Pitt St skyscraper at Circular Quay and the redevelopment of Harbourside Shopping Centre in Darling Harbour.

Mirvac boss Campbell Hanan. Picture: Nikki Short

The site it sold in the Parramatta CBD is at the intersection of George St and Smith St, and Mirvac wanted to capitalise on the billions of dollars of infrastructure investment in the area.

The tower is almost 90 per cent ­vacant, and Mirvac considered both an office scheme and a build-to-rent project for the site. The 9567sq m building has about 104 car spaces and was valued at $53m last December.

The Australian Chiropractors Association is in a small space, and the new owner could look to reposition it and lease up the space once demand in the area recovers. The building has a NABERS rating of 2.5 stars.

John McCann of Colliers International brokered the sale but declined to comment.

Parramatta has seen a run of deals. The Australian Unity Office Fund, which had lodged plans for a build-to-rent tower in Parramatta, later sold its properties at 2 and 10 Valentine Ave.