The 66 – 80 Collins Street Hobart Office Fund

66 – 80 Collins Street, Hobart

An A-Grade freehold office building constructed in 1997, this property was purchased in 2019 for $35.15 million.

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The property

Features at the time of purchase included:

  • Centrally located in Hobart’s CBD on the southern corner of Argyle and Collins Street, with 10,037m2 NLA.

  • 55 carparks onsite.
  • Immediate proximity to the Elizabeth Street Mall (a main shopping district) and opposite The Royal Hobart Hospital, Hobart Private Hospital and Hobart GPO.

The investment

The investment strategy identified at purchase highlighted:

The opportunity to undertake building refurbishment, re-lease vacant space, reduce building operating costs and seek lease extension and market rental reviews on major tenant leases.

Terraplex has recently agreed the following leases with the Tas State Government:

Department of Fire and Emergency Services (DPFEM)
Area: 2,048m2 (20% of NLA)
Term: 10 years
Options: 2 x 5 years

Department of Treasury and Finance (Treasury)
Area: 5,064m2 (50% of NLA)
Term: 12 years
Options: 2 x 5 years

We estimate these new leasing deals have added significant value to the building and are in the process engaging an external valuer to estimate this.

Terraplex has also engaged a team of consultants to assess further re-development potential (STCA) to add more office space on the roof.

Address66-80 Collins Street, Hobart
Purchase Price / Date$35.15m / 25 Nov 2019
Estimated New Valuation$50m plus
Lettable Area10,037 m2
Passing Net Income $2.51 m pa
Est Fully Leased Net Income$2.803 m pa
Building Replacement Cost$60.0 m
Property Yield on Passing Income7.1%
Property Yield on Fully Leased
Net Income
8.0%
Equity Raised$21.81 m