Investors are taking advantage of low interest rates to bolster their property portfolios, moving to snap up several key Sydney and Melbourne commercial buildings.
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In Sydney an office tower at 92 Pitt Street is coming onto the market from EG Fund Management, with a price tag of over $50 million.
The fund manager purchased the tower for $30.65 million on an initial yield of 7.3 per cent in February 2015 and has now engaged Knight Frank and Colliers International as advisory agents for its sale.
Assets totalling $14.5 million are also on the market on Sydney's north shore.
A Commonwealth Bank branch and two adjoining terraces in McMahons Point are up for grabs with the 51-53 Willoughby Road, Crows Nest site now leased to Commonwealth Bank Australia on a five-plus-five lease term. CBA has occupied the property for the past 40 years and only recently undertook a full renovation. It is being sold through CBRE's Aaron McLean and Danny Shi.
The site at 133-135 Blues Point Road, McMahons Point is a two-storey commercial building comprising 461 square metres over two levels. CBRE's Aaron McLean and Toby Silk will sell the property on behalf of the owner, Tony Dear.
Australia's favourable development conditions continue to attract offshore investors with a leading Singapore property and lifestyle company Wing Tai Holdings making its first foray.
The $4.7 billion group, which Cheng Yik Hung began as a garment manufacturer in Hong Kong, first signalled interest in expanding into Australia in 2000.
More than a decade later, Wing Tai through its investment vehicle Wingzest Investment has finally taken a stake in a long-term development play, purchasing a seven-level car park in Melbourne's Flinders Street for more than $31.5 million.
The 315-bay building at 380 Flinders Street on a land area of 1270 square metres faces towards the Yarra River and Crown casino.
It was offloaded by Richard Harbig, a Melbourne businessman who built his fortune in the fashion industry before investing in commercial real estate.
The building is leased to Secure Parking with options until 2028, with the top floor taken by telco AAPT for its fibre cabling network.
Colliers International's Matt Stagg, who negotiated the transaction with colleagues Daniel Wolman and Oliver Hay, said the low cost of debt and volatile sharemarkets had prompted competitive bids from long-term passive investors as well as developers.
Competition has seen commercial property yields tighten dramatically.
The Flinders Street car park is believed to have sold on a yield near 3 per cent, a similar rate to that achieved by another Melbourne property in Russell Street that this week sold in an off-market deal for $9 million.
The freestanding building at 205-207 Russell Street changed hands on an initial yield of 3.8 per cent, also to an offshore buyer who title documents reveal is Malaysian-based billionaire Loh Kian Chong.
Mr Loh also owns owns 469 Elizabeth Street, the Jasper Hotel in Elizabeth Street and the Strandbags building in Bourke Street Mall through Oceanwide International, a British Virgin Islands-incorporated company.
Colliers' David Sia, Oliver Hay and Daniel Wolman handled the transaction, with Thompson Geer partner Eu Ming Lim representing the buyer.
Mr Sia said the three-storey Harris building, constructed in 1891 and covered by heritage protections, transacted at a near-record land rate of $75,000.
"The current lack of opportunities in the Melbourne CBD, due to the tightly held nature of this asset type coupled with the lowest interest rates in Australian history, is creating strong competition," he said.
