Chinese insurance giant, Ping An, and Japan’s largest property company, Mitsubishi Estate, are funding Lendlease’s A$1.5 billion ($1.08 billion; €1.04 billion) Circular Quay Tower project.
Ping An Real Estate and Mitsubishi Estate will have 50 percent and 30 percent equity interests respectively, while Sydney-based property group Lendlease will retain a 20 percent equity interest in the project to develop Sydney’s tallest office.
“The partnership brings the vision of the Circular Quay precinct to life and will drive increased momentum for the proposal,” Lendlease's chief executive officer for property Kylie Rampa told the Australian Financial Review. “With Ping An Real Estate and Mitsubishi Estate Asia, we have secured two major global strategic partners to complement our development expertise.”
The project aims to redevelop landholdings at 174-182 George Street and 33-35 Pitt Street, Sydney and create city's tallest office tower at 248 meters, as well as two public plazas, laneways and a low-rise public building.
The investment from Mitsubishi Estate is the firm’s first in Australia.
“The interest from the institutional capital markets in Japan and China is evidence of the ongoing appetite for high quality premium commercial real estate in Australia’s key gateway cities,” said Nathan Parris, partner at Emerge Capital Partners, which advised Mitsubishi Estate on the Circular Quay Tower investment.
“We expect the strong interest of Japanese institutional capital in the global real estate markets to continue as Japanese institutions and funds continue to look for both growth and yield abroad.”