- Fortius Funds Management buys 307 Queen Street in Brisbane’s CBD off-market for $214.48 million in conjunction with PGIM Real Estate
- The A-grade office building is located in the ‘Golden Triangle,’ Brisbane’s financial centre
- The asset, which spans 25 floors and has 19,617 square metres of lettable space, is more than 93 per cent occupied
- Wholesale investors can access the asset through the Fortius Queen Street Trust, which is projected to return eight per cent p.a. average distributions
Fortius Funds Management, in collaboration with PGIM Real Estate, have purchased 307 Queen Street in Brisbane CBD in an off-market deal for $214.48 million from LaSalle Investment Management.
The A-grade office building is located in the heart of Brisbane’s financial district, within the so-called ‘Golden Triangle.’
The asset, which spans 25 floors and has 19,617 square metres of lettable space, is more than 93 per cent occupied, having attracted and kept tenants such as Heritage Bank and Bank of China.
Fortius chief executive Sam Sproats said the purchase provided an appealing chance to acquire a high-quality, centrally situated office building while also being an important part of the city’s growing central business area.
“As we continue to navigate the pandemic, there is an opportunity to capitalise on the dislocated office sector and find value,” he said.
“As workers return to the office and cities are revitalised we are seeing interest from domestic and international investors who are looking for agile assets with strong market fundamentals, such as 307 Queen Street.”
Mr Sproats said Fortius and PGIM believe that the office sector will remain part of workplace productivity, culture and performance, but noted that the size and shape of these spaces need to evolve.
The lobby and retail portions of 307 Queen Street were recently upgraded for $5 million, obtaining a 5 Star NABERS energy and 5.5-star indoor environment certification.
PGIM Real Estate is Prudential Financial’s real estate investment and finance business. PGIM is Prudential Financial’s $1.4 trillion worldwide investment management company.
The Brisbane CBD office market is appealing, according to Steve Bulloch, managing director and head of Australia at PGIM Real Estate, due to the city’s future economic and demand predictions, continuing infrastructure spending, and increased offshore investor interest.
Knight Frank head of capital markets Queensland Justin Bond introduced Fortius Funds Management and PGIM to the vendor, LaSalle Investment Management.
Mr Bond stated that 307 Queen Street was a high-quality asset with solid investment fundamentals that had performed well during the pandemic, with continued tenant demand.
“The strong cashflow, occupancy and prime location were the most appealing attributes of the investment for the buyer,” he said.
Wholesale investors may have access to 307 Queen Street through the Fortius Queen Street Trust, which is expected to yield an average annual return of eight per cent.