The Forza 399 Lonsdale Street Fund is an unlisted property fund which acquired a well constructed 10,033m² commercial office building with 14 car parks (the “Property”). Located centrally in the CBD, one of the elements that attracted Forza Capital to the asset was the fact that so few investment grade, freehold office assets transact in Melbourne’s CBD in any given year.
Purchased off market for $86,800,000 or $8,651m², the Property is currently 100% occupied with a WALE of over 4 years. Initially, the strategy was to vacate the existing education tenants and pivot the asset to higher rent paying traditional office tenants. However, the education sector substantially strengthened with tenant demand seeing the rents achieved equivalent to those of traditional office tenants but without the capital outlay required to reposition the asset to traditional office use.
The Fund has recently leased two floors to the Victorian Department of Education for use as the Year 9 campus of University High School which further adds to the education credentials of the asset.
399 Lonsdale Street sits centrally within the Melbourne CBD and is a building with fantastic natural light to 3 sides. It presents as a compelling leasing option for education sector and retains future upside to upgrade to office accommodation.
