Developer Mirvac sells 50% of 664 Collins St, Melbourne

04/07/2017 4:10 am

Australia's Mirvac Group has entered into an agreement to sell 50 per cent of a Melbourne office development for $138 million (USD $105 million).

The property developer inked a deal with an investment vehicle, sponsored by Morgan Stanley Real Estate Investing to sell a stake in 664 Collins Street, Melbourne, with a capitalisation rate of 4.97% given the acquisition consideration.

As part of the transaction, MSREI will fund 50% of the total development costs, while Mirvac will provide development management and ongoing property and investment management services.

The building is already 62 per cent leased with Pitcher Partners and ExxonMobil pre-committing, while the remaining spaces are under a heads of agreement.

Mirvac will, on its part of the transaction, provide a five-year rental guarantee on any unlet office or retail space from the date of practical completion.

Upon completion, 664 Collins Street will provide 26,000 square metres of office space across nine levels. The property is expected to be completed in 2018.