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Dexus (ASX:DXS) sells 50pc of Sydney building for $925M
Source: Grosvenor Place
  • Dexus (DXS) will sell 50 per cent of its Grosvenor Place building in Sydney for $925 million
  • Grosvenor is a 44-level office tower and was sold for 5 per cent of its June value, showing the vacancy and short term leasing risk in the asset
  • Dexus didn't name the buyer but said it is an existing co-owner of the property
  • The purchase will need the Australian Foreign Investment Review Board (FIRB) approval and is expected to be completed in early 2021
  • Funds from the purchase will initially be used to repay debt
  • On market close, Dexus is up 0.31 per cent and is trading for $9.85 per share

Dexus (DXS) will sell 50 per cent of its Grosvenor Place building in Sydney for $925 million before transaction costs.

The 50 per cent interest includes 25 per cent owned by Dexus and 25 per cent owned by the Dexus Office Partnership, in which Dexus holds a 50 per cent interest in.

Grosvenor is a 44-level office tower that was built in 1988 and as of June had was 89 per cent occupied. Major customers in the building include Deloitte and Wilsons Parking.

Dexus didn't name the buyer but said it is an existing co-owner of the property. Grosvenor was sold for 5 per cent less than what it was worth in June, showing the vacancy and short term leasing risk in the asset.

The purchase will need approval from the Australian Foreign Investment Review Board (FIRB) and is expected to be completed in early 2021. Funds from the purchase will initially be used to repay debt.

"This transaction continues our asset recycling strategy, realising value for both Dexus and our Dexus Office Partner," Chief Investment Officer Ross Du Vernet said.

"The sale further strengthens our balance sheet and enables us to organically fund higher return growth initiatives in our funds and development businesses. It also provides improved capacity to undertake capital management initiatives should there be a continued disconnect between public and private markets," he concluded.

On market close, Dexus is up 0.31 per cent and is trading for $9.85 per share.


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