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Charter Hall Group (Charter Hall or the Group) today announced that a Charter Hall Direct managed fund, PFA, has made a strategic divestment of a Port Adelaide office asset for $62.75 million, reflecting an initial yield of 4.6%.
The property, located at 21-25 Nile Street, was acquired as a fund-through development in 2017, with a total completion value of $43.6 million, reaching practical completion in 2018 with a 15-year lease to the South Australian Government.
Charter Hall Direct CEO, Steven Bennett, said, “The PFA fund has grown to over $2.3 billion since this asset was acquired in 2017. We have continued to curate the portfolio via selective divestments and importantly upgrade the portfolio through investments in core CBD and emerging precincts.
“This asset sale provides an opportunity for PFA to realise returns for our investors and re-deploy capital into new acquisitions and fund existing developments, such as 60 King William Street, in the Adelaide CBD, further enhancing the portfolio. On completion 60 King William will target a 5-star NABERS Energy rating, a 6-star Green Star Design and As-Built rating.”
Recent portfolio upgrades include the 50% interest in the $140 million acquisition of 6 Stewart Street, Newcastle leased to the NSW government, 50% interest in the $530 million acquisition of 570 Bourke Street in Melbourne CBD and the $100 million Innovation Quarter at Westmead, which has a 10-year WALE and is anchored by major tenants WSU and CSIRO, due for completion later this year.
Further strong equity inflows from investors demonstrate the attractiveness of PFA’s portfolio curation and the strength of realised returns on assets such as Port Adelaide, which has delivered a strong investment return for PFA investors.
PFA remains open for investment.