Quintessential Equity secures windfall with Canberra office sale
Australian Financial Review
14 June 2017
Quintessential Equity paid $14m for the six-level office building in 2012
Property fund manager Quintessential Equity has secured a windfall for its high-net worth investors after selling a Canberra office building for $58.4 million to Asian investors – having paid $14 million for it five years ago.
Much of the value uplift has come from Quintessential undertaking an extensive refurbishment of the 12,377sq m, six-level office building at 2-6 Bowes Street in the Woden Town Centre and then securing ACT Health as an anchor tenant on a new 15-year lease.
“It’s a great result for what was a pretty tired building when we first purchased it,” Quintessential Equity chief executive Shane Quinn told The Australian Financial Review.
Quintessential acquired the building known as Penrhyn House when it was 65 per cent occupied with 18 months remaining on the lease.
It then spent about $10 million on an upgrade including to the lifts, airconditioning and facade. But it stood virtually empty for almost two years until Quintessential secured ACT Health as the major tenant last year, after the ACT Government committed to bringing two departments to Woden.
About 750 ACT Health staff moved into the Bowes Street building in December, a move that helped rejuvenate the Woden Town Centre and enabled ACT Health to consolidate from multiple locations into one site.
“When the federal government jobs left Woden, the lifeblood of the town centre took a massive hit, resulting in longstanding small businesses going under,” Mr Quinn said.
“It gives me great pride to be involved in the complete regeneration of a building which not only benefits those occupying the building but also those within the surrounding area, returning vibrancy to the Woden Town Centre.
“We worked with the incoming tenant to build a world class collaborative workspace that will benefit the ACT Health now and well into the future, providing efficiencies for those who work in the department.”
Paul Powderly and Tim Mutton of Colliers International negotiated the sale of 2-6 Bowes Street on a 6.58 per cent yield to private real estate group Altis Property Partners, which acted on behalf of an offshore group based in Asia.
Altis, led by former Valad Property Group executive Shaun Hannah, manages a $2 billion-plus portfolio of office, industrial and large format retail assets on behalf of its investor clients.
The property was held in a special purpose vehicle trust managed by Quintessential and open to wholesale investors including high-net worth investors. The sale of the building was part of efforts to wind up the fund.
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