Singapore-based Keppel REIT has divested its 50% interest in 275 George Street, a 31-storey freehold office building, in Brisbane, Australia to Charter Hall Prime Office Fund (CPOF) for A$275 million.
Keppel REIT said CPOF currently holds the other 50% interest in the property.
Completed in 2009, 275 George Street is located in Brisbane’s central business district with 41,720 sm of net lettable area. The development has a committed occupancy of 90.6% as at 31 March 2021. Its principal tenants include Telstra Corporation and the Shell-operated Queensland Gas Company.
275 George Street was acquired by Keppel REIT in 2010 as its first Australian asset. The adjusted consideration of A$264 million is 7.8% above the last valuation of A$245 million and 59.0% above the original purchase price of A$166.0 million in 2010.
“The divestment of 275 George Street is part of our continuing portfolio optimisation strategy, and will provide us with greater financial flexibility as we seek strategic and higher yielding acquisitions to enhance the REIT’s income resilience and deliver sustainable total return to Unitholders,” said Paul Tham, CEO of the Manager.
Keppel REIT is expected to recognise an estimated accounting gain of A$9.8 million (or approximately S$10.0 million) from the divestment.