Quintessential Equity is pleased to announce the off-market acquisition of 30 Pirie Street, Adelaide, a landmark office building located in the heart of Adelaide’s CBD.
Quintessential Equity purchased the property within its third commitment fund, Master Fund No.3, for $73million from Australian Unity Office Property Fund (AOF Fund), settling the transaction on 20th December 2022.
Ahigh-quality building in a prime location, 30 Pirie Street is an excellent investment for Quintessential Equity’s growing Adelaide portfolio.
Quintessential Equity Executive Chairman Shane Quinn said the group was thrilled to have acquired 30 Pirie Street.
“This isa premium office building perfectly placed to capture demand for prime contiguous spaces, an acquisition that allows us to build on our long standing reputation and continued investment in Adelaide, growing our presence within a core CBD location,” he said.
The purchase solidifies Quintessential Equity’s presence in Adelaide, with Lot Fourteen, 100 King William Street, 431 King William Street and Port Adelaide Distribution Centre representing over $950 million of investment in Adelaide.
With a substantial CAPEX budget of approximately $30 million, Quintessential Equity will undertake significant refurbishment to regenerate 30 Pirie Street, both aesthetically and mechanically.
“We intend to elevate the building to market leading in a prime CBD location. With Adelaide’s office market continuing to deliver strong returns, 30 Pirie Street will provide a high-quality income stream and exceptional tenant experience.”
Works will include significant upgrades to the ground floor lobby, end of trip facilities, tenancy refurbishments, as well as modernizations to the lifts and building façade.
Various energy efficiency initiatives are also planned to future proof the property, with a commitment to elevate the building to achieve a minimum 5 Stars NABERS Base Building Energy Rating.
30 Pirie Street will offer a variety of spaces including warm shell open spaces, fully fitted suites and the regeneration of existing fit out, to meet a variety of tenant needs and create convenient and functional spaces to which the market has responded favourably.
The central Adelaide office block is currently 100 per cent leased to five tenants, including Telstra, who has occupied the building since it was constructed by the company in 1987.
The building maintains an excellent reputation in the Adelaide CBD, located in the city’s core precinct across from Adelaide Town Hall, consisting of 23 levels of office above a ground floor and spans 24,078.6m2 of net lettable area.
With prominentstreet frontage and proximity to pedestrian links, urban gardens, public transport,parking, and outstanding food and beverage offerings, it also featuresexcellent on-floor ceiling height and natural light, and a double-height groundentrance.
The building will be ideal for tenants in the Government, legal, IT, financial services, and engineering sectors, with Quintessential Equity looking to secure a range of contiguous-floor, single-floor, and split-floor/sub-500m2 tenants in future.
Knight Frank agents Max Frohlich and Justin Bond, and Colliers agents Paul Van-Reesema and Alistair Mackie introduced Quintessential to the vendor.
Max Frohlich, Director, Head of Institutional Sales SA said “Twelve sales above $10 million have settled in Adelaide CBD since January 2022, reflecting a total sales volume of $441 million, up from a total sales volume of $251 million last calendar year.
“Around70 per cent of these transactions occurred prior to the RBA’s first of eight consecutive cash rate hikes in May 2022.
“However, this excludes five assets which are in due diligence or have exchanged and are yet to settle; including these assets transaction volumes measure approximately $735 million in total.
“Due to the recent sharp rise in interest rates, buyer demand has shifted from core to value-add opportunities where the increased cost of capital can be offset with enhanced returns from active management initiatives. 30 Pirie Street is another great example of this.”
Paul Van-Ressema, Director, Capital Markets & Investment Services, Colliers, said “the Adelaide office market remains resilient and continues to be a popular destination for investors.
“The sale of 30 Pirie Street instils confidence in the office market going into 2023and we will expect to see genuine engagement from equity investors supported with debt solutions, to access the market looking for risk adjusted investments.”