City of Sydney bundles up Woolstores complex in $110m deal
The City of Sydney Council has purchased a heritage-listed office property, The Woolstores at Alexandria in inner-city Sydney, for $110 million from RF CorVal, the property funds platform backed by Rich Lister Andrew Roberts,
The transaction of 4C-4F Huntley Street in Alexandra was struck on a yield of 4.9 per cent yield, while the property has an average lease expiry of 3.3 years.
For the City of Sydney, the acquisition stacks up for its broader investment strategy and is part of our long-term financial plan, a spokeswoman told the The Australian Financial Review.
“The income from this type of investment helps to fund the City’s services and capital works projects, easing the burden on ratepayers,” she said.
Just 15 minutes from the Sydney CBD, the Woolstores comprises three restored heritage-listed wool sheds, reinvented as office spaces. Its major tenants include Living Edge, Swarovski and Thyssenkrupp Elevators.
RF CorVal acquired the Woolstores in 2015 for $51.7 million on a net yield of 7.5 per cent. The sale of the asset has achieved an investor internal rate of 21 per cent and an equity multiple of 3.1 times over the investment term.
“This is a great result for our investors,” RF CorVal’s head of transactions, Oliver Picone said.
“We acquired the property from the original developer as it neared completion, basing our strategy on the unique nature of the heritage office space and Alexandria being an up-and-coming market with the potential for growth.”
The funds management platform, backed by the Roberts family, is a busy trader in the commercial property market. In July, it sold a suburban office in Brisbane, held since it was developed seven years ago for an energy company, for $46.5 million to a Sydney-based private investor.
The latest transaction of the Woolstores was handled by Cushman & Wakefield’s Steven Kearney and Mark Hansen and Colliers’ Michael Crombie and Adam Woodward.
“The Woolstores has thoughtfully been constructed with a wide range of recycled heritage materials incorporated into a contemporary design providing good levels of character,” Mr Kearney said.
