Singapore-listed CapitaLand Integrated Commercial Trust has bought a half stake in an office and retail complex in North Sydney for $422 million on a yield of 4.9%. 

The deal marks CICT’s third acquisition in Sydney, growing its exposure to the city to $1.1 billion.  

The REIT bought 101 – 103 Miller Street and Greenwood Plaza, which is an integrated office and retail development in North Sydney’s CBD. 

The 101 Miller Street property is a 28-storey premium-grade office building, while Greenwood Plaza is the retail component.  

The complex is 94.9% occupied, with office tenants from the government, financial services and insurance sectors, in addition to several specialty retail and service outlets in the retail component.

The office offers large floor plates of up to 1,500 square metres and has gained 5-Star NABERS Energy, 4.5-Star NABERS Water and 5-Star Green Star ratings. 

“The proposed acquisition marks another step forward in CICT’s portfolio reconstitution journey to drive sustainable growth and diversify income sources through accretive acquisitions and recycling capital to higher yielding assets,” said Tony Tan, CEO of the REIT’s manager. 

“It will strategically augment our presence in Sydney, where we have embarked on acquiring 66 Goulburn Street and 100 Arthur Street. 

“The total investment of approximately A$1.1 billion (S$1.1 billion) in the three Sydney properties will provide CICT with a new engine of growth in a developed market with strong fundamentals, and the potential to ride on the city’s gradual recovery and rejuvenation in the mid to long term.” 

CICT entered the Australian market in December last year with the purchase of two grade-A office buildings in Sydney for $330.7 million.   

The deal comprised the 24-storey building at 66 Goulburn Street, Sydney and the 23-level property at 100 Arthur Street, North Sydney.   

CICT acquired the properties from CLA Real Estate Holdings through a unit sale agreement via two trusts that held the assets.   

The transaction marks the latest in a string of Sydney office deals in recent months, including Dexus’ sale of its interests in two offices in Sydney’s CBD and Parramatta totalling $555m.  

Last month, Dexus also sold a Sydney CBD office to Charter Hall’s prime office fund for $385 million, in addition to a North Sydney office to LaSalle Investment Management for $152.4 million. 

Abacus Property acquired a Sydney CBD office building for $250 million late last month, while Stadia Capital purchased a Harry Seidler-designed office building in North Sydney from a consortium of investors for more than $80 million. 

Last month, the Australian Unity Office Fund sold a grade-B office in Parramatta for $66 million, as Keppel REIT purchased a grade-A office development in North Sydney for $327.7 million.