Parramatta office tower on the market for about $50 million

The Century Centre in the Parramatta CBD has been listed for sale for the first time on behalf of private developer Capital Corporation, which is seeking about $50 million for the 12-storey A-grade office building. 

The building is located in the business hub of Parramatta CBD between George and Macquarie streets on a heritage-listed site steeped in history. It sits above the convict-built sandstone barrel-drains that run under Church, George, Smith, Charles and Macquarie streets. A portion of the drains can be viewed via a glass floor in the building’s foyer. 

The listing of the building located at 18 Smith Street (and commonly referred to by that name) follows the latest Property Council office vacancy statistics showing that Parramatta’s A-grade vacancy rate was just 2.4% as at July 2011. 

The Parramatta office market, often referred to as Sydney’s second CBD, has been among the most actively leased markets over the last year, with Savills reporting an 81% increase in the take-up of office space for the 12 months to June 2011. 

According to Savills, the Parramatta CBD, which comprises about 685,000 square metres of stock, is expected to benefit from a strong recovery in the Sydney CBD market. 

The Century Centre has a net lettable area of approximately 12,000 square metres and includes parking for 166 cars. It is located approximately 150 metres from the Parramatta bus/rail interchange and close to Westfield Parramatta. 

It was completed in 1999 by Cencorp Property Group, which merged with Capital Corporation in May 2008. 

It recently underwent a $4.8 million refurbishment that included a stylish foyer makeover, the revamping of common areas and the installation of an air-conditioning system, which resulted in its NABERS energy rating being upgraded from 2.5 stars to four stars. 

It is anchor tenanted by Telstra subsidiary NDC (the original anchor tenant), which recently recommitted to 6,600 square metres of space in the building. Other major tenants include Suncorp, which occupies 2,490 square metres of space, alongside Pepper Australia and Employers Mutual, which recently leased 1,140 square metres and 770 square metres of space respectively.

CBRE’s Greg Cohen and Michael Brislane in tandem with Frank Sassine and John McCann of Colliers International will jointly market the building, which is expected to draw interest from both institutional buyers and private investors. 

Cohen says the building’s location in the financial core of the Parramatta CBD is expected to underpin interest in the sale campaign. 

“This is the first A-grade Parramatta building to be offered via an on-market campaign in recent years,” he says.

According to Colliers’ Frank Sassine Parramatta’s strong market fundamentals are expected to underpin interest in the sale.

“Further analysis, indicates only two opportunities are currently available for tenants seeking A grade office space greater than 1,000sqm and there no options for those tenants looking at more than 2,000 sqm of contiguous A grade space,” he says. 

“As a result, rental growth has commenced, in particular for the A Grade market, and this is expected to continue given the lack of new supply in Parramatta,” Sassine said. 

Proceeds from the sale of the Century Centre will be reinvested in future Capital Corporation development projects including MCentral Macquarie Park, AXIS @Sydney Olympic Park and residential developments in Mascot and  Rosebery. 

Expressions of interest will close in late November.