Swiss AFIAA Foundation does an asset swap deal, buys in Melbourne, sells Brisbane HQ to realty investor

The Swiss AFIAA (Foundation for International Real Estate Investments) has broadened its interest in the Australian real estate market with an “asset swap”. 

The company has bought an office building in Melbourne’s 628 Bourke Street (above) for its property portfolio for around $181 million. The seller is M&G Real Estate Asia. 

In return, AFIAA has sold its “HQ South” office building at 520 Wickham Street (Fortitude Valley) in Brisbane, which measures nearly 14,000 sqm, to the investor for $119 million. 

The Melbourne property is in the CBD and offers around 23,400 sqm of office space and 940 sqm of retail space. Both the lift lobbies and individual floors have been renovated in recent months. One of the key tenants is the insurance company QBE.

AFIAA chief executive Ingo Bofinger said the group was planning further acquisitions in central metropolitan locations as part of its growth strategy. 

“The transaction is a prime example for the implementation of our focus strategy: We are investing the sale price received for HQ South of around AUD 119 million in a larger property in Melbourne, where we already have two more properties,” Bofinger said.

“We are eying further potential to increase rents in excellent locations in Melbourne in particular.” 

Potential properties also include real estate with development potential whose value added is to be enhanced by asset management using refurbishment measures.

In Australia, AFIAA also owns properties in Sydney in addition to two other properties in Melbourne’s CBD. 

AFIAA is an investment foundation under Swiss law that invests foreign real estate assets. Forty-five Swiss pension funds currently invest directly in prime foreign properties through AFIAA. The properties in Australia are centrally managed by the AFIAA office in Sydney. 

The legal consultant for the acquisition and sale was Mills Oakley.