Dexus forms joint venture to bag $375m interest in Sydney skyscraper

Dexus forms joint venture to bag $375m interest in Sydney skyscraper

Real estate group Dexus (ASX: DXS) has partnered with Singapore-based Mercatus Co-operative to acquire a 33.33 per cent interest in 1 Bligh Street, Sydney for $375 million.

Under the Mercatus Dexus Australia Partnership (MDAP), Mercatus will hold an indirect 90 per cent share in the joint venture with Sydney-based Dexus holding the remaining 10 per cent.

Post-acquisition Dexus will continue to manage the property and increase its effective ownership interest in the skyscraper to 36.66 per cent.

Situated in Sydney's CBD, 1 Bligh Street is a premium-grade, 29-storey building overlooking the Sydney Harbour and is 99.5 per cent occupied by major tenants including Clayton Utz, Bloomberg Australia and the Commonwealth Government.

Dexus CEO Darren Steinberg said the establishment of MDAP and the acquisition of the interest in the tower was consistent with the company's strategic initiative of expanding and diversifying the funds management business.

"This transaction demonstrates the ongoing strength of demand from international institutions for high quality Australian office asset exposure under Dexus platform management," Steinberg said.

The deal marks Mercatus' first foray outside of Singapore and into Australia.

"This acquisition is part of our strategy to diversify our portfolio and to generate sustainable long-term returns," Mercatus CEO Tan Ser Joo said.

"We are honoured to partner with Dexus, one of Australia's leading real estate groups, in our first direct real estate investment overseas."

Settlement of the acquisition is subject to Foreign Investment Review Board approval, with Dexus' interest funded from existing debt facilities.

Shares in Dexus are down 2.23 per cent to $9.19 per share at 10.15am AEDT.

Never miss a news update, subscribe here. Follow us on LinkedIn, Instagram and Twitter.

Business News Australia

Help us deliver quality journalism to you.
As a free and independent news site providing daily updates
during a period of unprecedented challenges for businesses everywhere
we call on your support

Facing the latest impacts of cyber-crime: cyber insurance premiums increase for businesses
Partner Content
As Australian businesses are forced to adapt to a new normal yet again, a different typ...
Aon
Advertisement

Related Stories

Charter Hall-Abacus consortium to buy Brisbane Club property in deal worth $63.5m

Charter Hall-Abacus consortium to buy Brisbane Club property in deal worth $63.5m

A consortium owned by Charter Hall Group (ASX: CHC) and Abacus Pr...

Sunland to sell site of rejected Brisbane project Grace on Coronation

Sunland to sell site of rejected Brisbane project Grace on Coronation

Property developer Sunland Group (ASX: SDG) has announced the con...

RF Corval buys $20.5m office property in Newstead, Brisbane

RF Corval buys $20.5m office property in Newstead, Brisbane

Sydney-based fund manager and investor RF Corval has acquire...

Quintessential Equity to build $400m Adelaide innovation hub

Quintessential Equity to build $400m Adelaide innovation hub

Adelaide's Lot Fourteen precinct is awash with talent as it a...