Two adjoining office buildings in the heart of Newcastle’s thriving business district have sold to RF CorVal. 

The combined offering at 26 & 28 Honeysuckle Drive, which provides 9,432 sqm of NLA and a diversified income from corporate and government tenants, was sold by the Colliers team of Matthew Meynell, Peter Macadam, James Girvan and Catherine Scott. 

“We experienced strong interest from both local and offshore parties throughout the campaign, with active capital particularly focused specifically on office assets with value-add potential, allowing them to leverage different strategies specific to the property and market,” Mr Meynell said. 

“Considered the global gateway for Northern NSW and with approximately $6.5 billion in infrastructure both planned and underway, Newcastle has all the fundamentals of a thriving global economy with this deal evidence of continued support and investment in the city’s commercial office market,” Mr Macadam added. 

“In the case of 26 & 28 Honeysuckle drive, the asset’s build quality, blue-chip occupiers offering attractive yield that was a major drawcard for investors looking at this opportunity,” Ms Scott said. 

RF CorVal’s CIO Oliver Picone said, ”We have been selectively bidding on office assets as the market starts to bottom out and vendors become more realistic.  The attraction of 26 & 28 Honeysuckle was the strong existing tenancy profile, high yielding nature of it and ability to add value through active asset management.  We are also looking to eventually realise each building individually to enhance liquidity. We have a strong track record in similar office assets and believe the Newcastle market has held up reasonably well post covid, incentives in particular are largely under control.”  

The buildings have undergone an extensive capital expenditure program and provide prime quality improvements in a market where future supply will be constrained due to increasing construction costs. 

Occupiers of the two prime grade assets include QBE Insurance, Sparke Helmore, BHP and Nine Entertainment. The buildings also boast strong ESG credentials as well as 165 on-site car spaces and market leading end-of-trip facilities.

Colliers research shows that in 2023 over 60 per cent of office transactions sub $150 million were acquired by high net worth or family office investors. This trend is consistent with patterns seen in 2024, with 47 per cent of transactions in Q1 by these groups and 27 per cent via syndicator groups who leverage private capital.