Anson House sold for $85m

Macquarie-managed fund's loss partly offset by currency movements

(SINGAPORE) In the second transaction of an office block in the past few days, a fund managed by Australia's Macquarie Bank has sold Anson House. The price is said to be about $85 million or slightly over $1,100 per square foot of net lettable area (NLA).

The 13-storey office block, which was completed 11 years ago, is on a site with a remaining lease of about 87 years.

Anson House boasts tenants such as ArcelorMittal, GE Group and Swire Shipping, and is about 98.5 per cent leased. The net yield on the investment based on the $85 million transaction price would be more than 6 per cent, BT understands.

Sources suggest the purchaser could be a group of high net worth individuals with a presence in Singapore and Australia. The office block was sold via private treaty.

The Macquarie Bank-managed fund which sold Anson House had bought the office block for $129.5 million in 2007. However, its loss should be partly offset by the Singapore dollar's appreciation against the Australian dollar, market watchers say.

The sale-and-purchase agreement for Anson House is said to have been inked on Monday, the same day that BT reported the sale of the freehold Parakou Building at the Robinson Road/McCallum Street junction, for $81.38 million or $1,280 psf of NLA.

It was acquired by a unit of Cathay Organisation, controlled by Choo Meileen. The seller, New Star Asset Management Group (now part of Henderson Group), also owns One Phillip Street, for which it is said to have recently received offers of about $1,500 psf.

But industry observers reckon New Star would be under less pressure to sell the 999-year leasehold property - for which it paid $2,736 psf early last year - now that it has already divested one asset in Singapore.

'The market is starting to see a return of confidence for office investment sales deals,' notes Cushman & Wakefield Singapore managing director Donald Han, pointing to an uptick in activity and prices of strata offices.

BT recently reported a sweet spot is surfacing among high net worth investors from Singapore and the region for office blocks here priced between $1,100 and $1,300 psf, and involving lump sum investments of $70-100 million.

Source: Business Times, 20 May 2009