News

Major lease to Commonwealth Government extended in Canberra

2 June 2015

Growthpoint Properties Australia ("Growthpoint") is pleased to announce an eight year extension of the lease at its office buildings at 10-12 Mort Street, Canberra, ACT ("the property") to the Commonwealth of Australia (represented by the Department of Employment).

The lease was originally due to expire in March 2017 and represents 4.0% of Growthpoint's previous potential lease expiries for the 2017 financial year which have now been reduced to 3.6%. Growthpoint's weighted average lease expiry term has been extended to 6.5 years as at 31 May 2015.

ORIGINAL ACQUISITION

Growthpoint purchased the Property in August 2012 for $55.8 million at an initial yield of 10.28%. At acquisition, the Property was leased to the Commonwealth of Australia for five yars (from March 2012) and had been recently refurbished.

The Property comprises 15,398sqm net lettable area across interconnected office buildings.

Growthpoint was attracted to this acquisition due to the relatively high passing yield, fixed rent reviews of 3.75% per annum, prospects for lease renewal and the prime location in Canberra's Civic precinct.

NEW LEASE TERMS

The lease of the Property has been extended to March 2025, an additional 8 years and now has a remaining lease term of 9.8 years from 31 May 2015. The lease was renewed at market rates.

To find out more, download the full ASX Announcement.