Mirvac Spends Half a Billion on Big City Assets

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Thursday, November 14th, 2013
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The Mirvac Group has spent over half a billion dollars on the acquisition of key assets in the Melbourne CBD and Sydney’s Darling Harbour.

The property giant has spent $552 million on the acquisition of two office blocks on Collins Street in the Melbourne CBD, and the Harbourside Shopping Centre in Sydney’s Darling Harbour.

Mirvac picked up 367 Collins Street and 477 Collins Street for $228 million and $72 million respectively. Both locations are are key office properties in the heart of downtown Melbourne.

The landmark Harbourside Shopping Centre was purchased for a consideration of $252 million, bringing the price tag for Mirvac’s latest raft of property acquisitions to well over half a billion dollars.

Susan Lloyd-Hurwitz

Susan Lloyd-Hurwitz

Susan Lloyd-Hurwitz, Mirvac’s chief executive and managing director, touted the purchases as strategic acquisitions in line with Mirvac’s current development objectives. The purchases were all fully debt-funded, with Mirvac expecting them to have a positive impact on earnings as early as the next financial year.

“[They] demonstrate the continued execution of our strategy and present Mirvac with the opportunity to leverage our integrated model via asset management, repositioning and development,” said Lloyd-Hurwitz.

Lloyd-Hurwitz sees the Collins Street purchases as giving Mirvac “CBD office assets that provide us with repositioning and development opportunities.”

The 367 Collins Street site is an A-grade office building with views of the Yarra River. The 33-floor, 37,895 square metre property was purchased on a 7.8 per cent fully let yield. Mirvac hopes to fill current vacancies in the short term and upgrade the facilities in the medium term.

Meanwhile, 477 Collins Street is a B-grade office building with 11,988 square metres of space and a six-level car park which can accommodate 598 cars.The property was purchased on a fully yet yield of 7.6 per cent with Mirvac planning to transform the address into a prime-grade office spot.

Sydney’s Harbourside, on the other hand, is one of Australia’s most renowned retail sites and is expected to enable Mirvac to “gain greater market share in the Sydney CBD area…with exposure to the strongly performing food, catering and entertainment categories.”

Harbourside is a three-level retail centre with 21,039 square metres of space. It was purchased on a fully let yield of  7.1 per cent. Mirvac hopes to upgrade the quality of the site’s tenants in the food and fashion categories.

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