Centuria Property Funds has announced it has exchanged contracts to sell 2-10 Wentworth Street, Parramatta, NSW for $105.3 million.

Purchased in December 2014 for $45.1 million, the A-grade office tower was the sole asset in the closed-end, unlisted Centuria 2 Wentworth Street Fund.

The property has been sold following the completion of the fund’s five-year term, with settlement expected to occur in Q1 CY2020.

At a glance:

• Centuria Property Funds has announced the sale of 2-10 Wentworth Street, Parramatta, NSW for $105.3 million.
• The property has been sold following the completion of the fund’s five-year term, with settlement expected to occur in Q1 CY2020.
• The deal was brokered by Steve Kearney, Simon Fenn, Mark Hansen and Claire Zouroudis from Cushman & Wakefield, and Bevan Kenny and Andrew Hunter from CI Australia.

Centuria Joint-CEO Jason Huljich said that investors will receive a total return of 186 per cent from the Fund, including an average distribution return of 9.2 per cent per annum. 

“When we purchased Wentworth Street in December 2014, our view was that the Parramatta office market was poised to benefit from a number of positive factors, including improving infrastructure links, the decentralisation of NSW government departments, and the overall gentrification of the area," he said.

“At the same time, A-grade office vacancy was below 1 per cent, which we believed could support stronger tenant appetite for quality office properties, which in turn would mean upward pressure on rents, a trend the Parramatta market has seen in recent years,” he said.

Mr Huljich added while improving market fundamentals in Parramatta were a contributor to performance, it was Centuria’s active approach to asset management and the team’s ability to maximise returns from the property which ultimately led to strong returns for investors.

“The team completed leasing transactions over 90 per cent of the property (9,807 square metres) during the life of the Fund, and achieved excellent rental growth – from an average of approximately $497 per square metre gross at acquisition to $617 per square metre gross at sale – an increase of 34 per cent,” he said.

Mr Huljich explained that Centuria has a strong focus on creating value for unitholders, by maintaining close relationships with tenants and actively responding to their needs.

“Quality tenants underpin the strong, reliable income streams that investors have come to expect from our unlisted funds, which is why we are so focused on maintaining and improving our properties to ensure excellent leasing outcomes,” he said.

This sale comes shortly after the disposal of both The Zenith in Chatswood for $438 million and the sale of a half share in 8 Central Avenue, Australian Technology Park, Sydney for $191 million.

Both assets were held in Centuria single asset unlisted funds. 

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