News and Media
22 December 2011 - Armada sails into Brisbane offices (Financial Review)
Armada funds management has joined the growing ranks of property investors backing the resources-backed Brisbane office market and has bought a commercial building for $60.5 million from receivers of a failed local property group.
Armada, founded by former UBS director Chris Monaghan, has been on the hunt for assets in Brisbane since buying Suncorp Tower for $64 million in August.
"We like the fundamentals of the Brisbane market," Mr Monaghan said. "There is a diminishing supply of good assets at a time when the resources sector and the associated groups that service it is expanding."
The deal, which reflected a yield of 9.5 per cent, comes hot on the heels of Growthpoint Properties Australia’s $200 million purchase this past week of three Brisbane office towers.
Like the recent Armada purchase, the Growthpoint buildings have resources tenants and several are on the city’s fringe, where the vacancy rate is 8.8 per cent, down from 11.8 per cent a year ago, and likely to fall further.
Growthpoint started buying into the Brisbane office market late last year with the $130 million acquisition of two fringe buildings. Growthpoint Properties Australia managing director Tim Collyer said the Brisbane market was likely to be strong for the next five years.
"We are positive on the Brisbane market. The vacancy rates are coming down and we think they are going to come down quite rapidly," he said.
Perth-based Primewest has also bought into Brisbane’s office market, spending more than $100 million in 18 months, while local syndicator Cromwell bought HQ North from Leighton Holdings for about $186 million last month.
CBRE’s Bruce Baker and Flint Davidson negotiated the Armada deal.
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