AMP Capital fund buys 50% of Mirvac’s 200 George Street office tower project for $317 million

AMP Capital’s unlisted Wholesale Office Fund (AWOF) has entered into an agreement with Mirvac to acquire a 50% interest in the land and development of its 200 George Street office project for $317 million. 

The site, currently occupied by a 5,500 square metre C grade building, is being redeveloped into a 37 storey, 38,000 square metre office tower, substantially pre-let to Ernst & Young (28,000 square metres of office space) for 10 years from completion. 

Major site establishment works commenced in January, with completion scheduled for early 2016. 

Mirvac will provide AMP Capital a rent guarantee over any remaining un-leased space at completion for a term of four years.

AMP Capital head of property funds management Chris Judd said as the original owner of the site, AMP Capital had previously negotiated rights to acquire a 50% interest in any future development on the site. 

“This transaction presents a rare development opportunity and an excellent investment outcome for our clients. 

“The acquisition is consistent with our strategy to remain focused on core, well located office towers and bringing some newer assets into the Fund to increase the quality of the portfolio and deliver our investors strong risk adjusted returns over the long term. 

“We are pleased to further build upon our relationship with Mirvac Group where we benefit from partnering with a well-regarded residential and commercial developer,” says Judd. 

“We are delighted to have AMP Capital as an aligned partner in 200 George Street for what will be a landmark premium grade asset, located in the financial and legal core of the Sydney CBD,” says Mirvac chief executive Susan Lloyd-Hurwitz. 

“This agreement further strengthens our relationship with AMP Capital and we will continue to look to work with them in future residential and commercial opportunities.” 

The AMP Capital Wholesale Office Fund is an open-ended unlisted trust investing in office buildings in Australia and New Zealand. 

The fund has assets of $2.8 billion as at 30 December 2012.