Straits Trading in deal to buy office building in Melbourne

THE Straits Trading Company said on Friday it has entered into a conditional agreement to buy an office building at 114 William Street, Melbourne for A$125 million (S$125.1 million) from a trust.

The deal is subject to approval from the Australian Foreign Investment Review Board. The vendor is Tackelly No 6 Pty Ltd, in its capacity as trustee of the Tackelly No 6 Trust.

The acquisition is expected to be completed by mid-August.

The 25-storey building is on a freehold site of 1,858 square metres and comprises 22 levels of office space, one level of ground retail space and two basement carparks.

It is leased out to a mix of "reputable, high quality" tenants from the financial and legal sectors which provide a ready stream of income. These include Westpac Banking Corp, one of Australia's Big Four banks, and Cornwall Stodart, a medium-sized law firm.

The building is located in the heart of the financial and legal precincts in the western core of Melbourne's central business district, near Southern Cross, Flagstaff and Flinders Street train stations. It is also close to major law courts.

Straits Real Estate (SRE), the subsidiary buying the property, intends to undertake various renovations over time to reposition the property and upgrade it to create additional value.

Desmond Tang, CEO of SRE, said: "This transaction will complement SRE's existing commitments in China, Japan and Southeast Asia and is in line with our strategy of tapping into higher returning real estate investment opportunities."