GDI 32 Premium Office Trust

Grenfell Centre, 25 Grenfell St, Adelaide

GDI Premium Office Trust

GDI Property Group is pleased to announce that CB Richard Ellis Valuation and Advisory Services has valued 25 Grenfell St, Adelaide at $100 million as at 30 June 2011 representing an increase of approximately 30% on the purchase price in November 2009.

The GDI Premium Office Trust investors have received distributions of 10% pa in fy 2010 and 10.5% pa in fy 2011 the Trust  will maintain a distribution 10.5% pa in fy 2012 on the original $1 per unit invested. Subject to final accounts we expect the NTA to be a minimum of $1.30 per unit. This represents a total return of around 25% per annum to investors.

The Grenfell Centre, 25 Grenfell Street, Adelaide, was purchased for $76 million in November 2009, The property is securely leased to quality tenants, including 48% to State and Federal Government on long term leases and 20% to a major Australian law firm to 2022. The property is located in the heart of the Adelaide CBD and the Adelaide  office market has significant potential for ongoing value and rent growth due to its low vacancy and lack of future construction in the city. The trust is currently conservatively geared, with a loan to value ratio of approximately 37%.

The increased value, through firming rents and tightening capitalisation rate, is further evidence of the strength in the Adelaide CBD office market and it’s recovery from a cyclical low during the GFC. 

Following a successful Green Building Fund grant from the Federal Government in 2010, the building has undergone a significant services upgrade resulting in a substantial improvement in building energy efficiency. A Development Application is now with the City of Adelaide Council to extend and refurbish the lower ground retail which on completion will provide a selection of upmarket food and beverage outlets and reinvigorate the adjoining plaza with alfresco dining options.

Further building enhancements are planned to improve the working environment for existing and future occupiers which are likely to include service retail outlets and private gymnasium.

The Adelaide prime office market vacancy is presently very tight and while the office space in the Grenfell Centre is presently fully leased, a full refurbished floor is to be made available next year with an asking rent in excess of $500 per square metre which is now the benchmark for Adelaide’s top office space.

For more information contact GDI Property Group on
02 9223 4222 or visit www.gdi.com.au