1 Market Street will be GIC’s first investment in Australian offices in years (Image: Investa)
Australian real estate investment manager Investa said on Wednesday that it has sold an office tower overlooking Sydney’s Darling Harbour for A$450 million ($317.6 million), in what it called a strategic capital recycling transaction, adding to signs of a recovery in the city’s office market.
Investa said its Commercial Property Fund sold the 1 Market Street tower to the Investa Core Plus Office Partnership, which is capitalised by what the company described as an existing capital partner. The Australian Financial Review identified that partner as Singapore sovereign wealth fund GIC, without saying where it obtained the information, and a GIC spokeswoman declined to comment on the transaction.
“It reflects sustained institutional conviction in the Sydney office market and demonstrates Investa’s ability to originate and execute investment opportunities that align with the objectives of our capital partners,” said Adam Crowe, Investa’s chief investment officer.
The deal marks a return to the office sector for one of Asia’s largest investors, with GIC having recently focused its estimated assets under management of more than $1.16 trillion on opportunities in Australia’s retail and self-storage sectors.
Darling Harbour Outlook
The deal, expected to close before the end of 2026, values the 29,453 square metre (317,029 square foot) tower at roughly A$15,280 per square metre of net lettable area (A$1,420 per square foot), according to a Mingtiandi calculation.
GIC chief executive Lim Chow Kiat
Brendan Looby, fund manager of the Investa Commercial Property Fund, said the sale was consistent with the fund’s strategy of “actively curating a market-leading prime office portfolio while creating capacity to capitalise on strategically aligned investment opportunities.”
The tower sits at the western end of Market Street, where a footbridge crosses Pyrmont Bridge into Darling Harbour and upper floors look out over Cockle Bay toward the Sydney Convention and Exhibition Centre — putting it at the meeting point of the financial district and the harbourside tourism and convention precinct, within walking distance of Town Hall railway station, the Sydney Metro and light rail services.
Investa has not disclosed the building’s occupancy rate or full tenant roster, although confirmed occupants include ASX-listed forensic software provider Nuix, which lists Level 29 of the tower as its global headquarters, and the Australian arm of Coty, the New York-listed beauty group behind brands including CoverGirl and Calvin Klein fragrances, which gives Level 31 as its registered office.
Completed in 1991, the 32-storey, grade A tower has average floor plates of 1,100 square metres, and carries a 4.5-star NABERS Energy rating and a 3-star Green Star Performance rating from the Green Building Council of Australia, according to Investa’s website.
Investa refreshed the building’s ground-floor foyer in 2010, adding a 12-metre café bench, a landscaped terrace and a new entry, part of a series of common-area upgrades that also included a 2020 refurbishment of the tower’s end-of-trip facilities.
Office on the Rebound
Office vacancy in Sydney’s city centre fell to 13.3 percent in the six months to July, a fourth consecutive period of improvement, according to the Property Council of Australia — with vacancy in premium-grade buildings dropping to 7.7 percent from 8.9 percent, over the same period.
Average gross effective rents across the city centre rose 8.3 percent year-on-year to A$1,135 per square metre by the end of the second quarter, according to JLL, as the lack of new office projects entering the market this year emboldened the city’s landlords. .
Investa said the deal “reflects confidence in Sydney office market fundamentals, with strong leasing demand and limited future supply expected to support rental growth and returns over the medium term.” The transaction comes a month after Investa and North American investment manager BGO agreed to buy a A$715 million portfolio of office buildings in Sydney and Brisbane from ASX-listed Dexus.
If confirmed, the deal would mark GIC’s first direct Sydney office acquisition in several years, following a run of Australian dealmaking concentrated on other property types — including teaming with Brookfield for the A$6.7 billion take-private of self-storage operator National Storage REIT in a deal which closed in May. The Singapore sovereign fund in March formed a A$500 million joint venture with Sydney-based Haben Group to invest in convenience retail properties.
Favoured Partner
The deal fits a broader pattern for Investa, which has become a favoured partner for global investors accessing the Australia market.
The company partnered with BGO — the real estate arm of Canadian insurer Sun Life — and Cliffbrook Capital in February to buy 100 Mount Street in North Sydney from Dexus for A$558 million, with Investa taking on both investment and property management of the tower.
Investa also managed the former MLC Building at 105 Miller Street in North Sydney on behalf of Oxford Properties Group until the Canadian pension-backed manager sold the heritage-listed tower to Wentworth in February for just over A$100 million.
Investa, which has a total of A$15.4 billion in office and residential assets under management, said the Investa Core Plus Office Partnership has the capacity to make further acquisitions. The company’s commercial property fund has A$5.5 billion in assets under management, including interests in Sydney’s Sixty Martin Place and Deutsche Bank Place.