Deka exits Brisbane office tower in AUD 380m sale to GPT

Deka Immobilien has sold Central Plaza 2, a major office tower in Brisbane’s central business district, to Australian real estate investment manager The GPT Group for approximately AUD 380m (€235m), as the German investor takes advantage of improving transaction conditions in Australia’s office market.

The property formed part of the Deka-ImmobilienGlobal open-ended real estate fund and is located at 66 Eagle Street in Brisbane’s Golden Triangle business district. The agreed value takes account of future incentives expected to be provided to existing occupiers.

Central Plaza 2 provides approximately 32,000 sqm of lettable space and 211 parking spaces. Completed in 1990 and subsequently renovated, the building was acquired by Deka Immobilien in 2020 following the refurbishment programme.

The tower is currently close to full occupancy and accommodates 25 tenants. Its principal occupier is Queensland Investment Corporation (QIC), the Australian institutional investment manager, which is expected to leave the property in the near future. The forthcoming vacancy represents a significant future leasing requirement for the building.

Deka’s decision to sell ahead of QIC’s departure reflects an asset-management strategy aimed at reducing exposure to the costs and uncertainty associated with securing replacement occupiers. The disposal also allows the fund to realise the investment at a time when Deka considers conditions in Australia’s office investment market to have improved.

The transaction illustrates how changing leasing profiles are influencing investment decisions even for well-occupied prime office properties. Current occupancy can support a disposal, while an approaching lease event involving a major tenant can materially change the future capital expenditure, incentive and leasing requirements facing an owner.

Deka-ImmobilienGlobal intends to redeploy the proceeds into other real estate opportunities as market conditions develop across different regions. The Brisbane disposal therefore forms part of a broader strategy of adjusting the fund’s portfolio in response to property cycles while limiting the reletting exposure associated with Central Plaza 2.