Centuria Property Funds, in conjunction with a private fund managed by global investment manager BlackRock, have announced the sale of their jointly-owned Zenith office towers in Chatswood for $438.2 million to Starwood Capital and Arrow Capital Partners.

The Zenith is an A-Grade office complex comprising twin 21 level towers and basement parking. 

The Centuria Zenith Fund holds a 50 per cent interest in the Property, co-investing with a private real estate fund managed by leading global fund manager BlackRock. 

Whilst it was originally intended that the property be held over a longer period, buyer interest in the property resulted in an acceleration of the exit.

According to Centuria, ten offers were received for the asset, with Head of Real Estate and Funds Management, Jason Huljich, describing the sale price as an outstanding result which reflected the general strength of the market and Centuria and BlackRock’s asset management strategy in enhancing the yield on the property.

“Income returns from the Centuria Zenith Fund have been excellent, on average 7.7 per cent p.a., which is very attractive in the current low interest rate environment.”

“The strong sale price achieved from The Zenith offers more proof of our ability to identify opportunities in strengthening markets, which allow us to implement our active asset management strategy to make our properties more attractive workplaces for both our existing and prospective tenants.” Mr Huljich said.

Centuria’s 50 per cent share of The Zenith is owned by investors in the single-asset, unlisted Centuria Zenith Fund, which will be wound up and proceeds distributed to investors, after the sale settles. BlackRock’s interest was held in a private real estate fund that it manages on behalf of its investors.

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