Charter Hall continues on acquisition trail

Charter Hall continues on acquisition trailFollowing last week’s announcement of Charter Hall’s DOF purchase of an office building in Brisbane, the group has taken control of a major development site in Melbourne and is reported to be in due diligence on Brookfield’s 1 Shelley Street in Sydney.Charter Hall’s wholesale Core Plus Office Fund (CPOF) has acquired the development rights for a 100 per cent leasehold interest in the Wesley site in central Melbourne for an undisclosed price. The site, home of the historic Wesley Church at 130 Lonsdale Street, is owned by the Uniting Church and adjoins Charter Hall’s office building at 1 Lonsdale Street.In January 2015 Leighton Properties, now CIMIC, was appointed preferred developer for the site. Following an agreement with Leighton and the Uniting Church, Charter Hall has now acquired the development rights for the proposed $0 million development, to be known as Wesley Place. On completion, it will comprise a 33-level A Grade office tower with 53,000 sqm of office space, a town square and a number of courtyard and garden spaces. The project will also involve the reuse and adaption of existing heritage buildings, which include Wesley Church, manse, schoolhouse and caretaker’s cottage. These buildings represent the earliest intact neo-gothic church complex in Victoria.In the past 12 months, two of Charter Hall’s managed funds, CPOF and DOF, have made a number of development acquisitions, including the new Western Sydney University campus and the new Aurizon headquarters in Brisbane’s Fortitude Valley. CPOF also recently acquired a commercial office building at 55 King Street in Melbourne’s CBD with potential for medium term redevelopment. Also in the past year, Charter Hall has completed major office projects at 570 Bourke Street, Melbourne and the new BoQ headquarters in Brisbane’s near city suburb of Newstead. The group’s development pipeline is now valued at more than $1.5 billion.Meanwhile in Sydney, Charter Hall is believed to be in negotiations to purchase 1 Shelley Street from Brookfield Property Partners for a price reported to be more than $0 million.The nine-level office building in the King Street Wharf precinct has a net lettable area of 32,986 sqm and basement parking for 268 cars. It is fully leased to Macquarie Bank and initial yield at a price of $0 million would be less than 5 per cent.In 2015 Brookfield placed nearly $2 billion worth of property on the market to fund its development pipeline. As part of this divestment, Melbourne’s Southern Cross complex was sold to Blackstone for $675 million and the World Square shopping centre in Sydney’s CBD was purchased by ISPT for $280 million. Two other properties at Jessie Street in Parramatta and 111 Alinga Street in Canberra are currently being marketed by JLL.