Landmark Toowoomba Office Building Sells for $8.475M

A fully-tenanted office building at the gateway to Toowoomba’s CBD has sold for $8.475m, signaling the largest office transaction in the regional city in almost two years.

Investment capital firm Arcana Capital purchased 162 Hume Street East Toowoomba which sits on a high exposure 3,680sqm site and hosts 2,160sqm of nett lettable floorspace and 72 car spaces.

A mixture of government - Department of Justice and Attorney General, Department of Communities and Darling Downs and West Moreton Primary Health Network – and private tenants including GHD, Signature Projects and McLean Care are housed on the site. Combined, they deliver a WALE of 3.6 years.

LJ Hooker Commercial Toowoomba’s Justin Eastwell and Chris Stewart managed the sale for a private syndicate which had held the property for almost 30 years.

“The campaign attracted a lot of enquiry from parties throughout Queensland and interstate due to the position of the property within Toowoomba's legal and financial precinct and the calibre of tenants,” said Mr Eastwell.

“Rarely does an asset of the scale come to market in Toowoomba. The actual sellers had held onto the property for three decades and over that time the Hume Street property has remained a landmark address.”

The various tenancies offer a passing net income of $695,110 per year, reflecting a passing yield of 8.2%.

Mr Stewart said the strength of the result was a clear demonstration of investor confidence in Toowoomba.

It continues Arcana Capital’s relationship with the city where it’s previously purchased a Darling Heights childcare centre ($3.9m) the Centrepoint on James Retail Centre ($13.75m) and the Pearl Energy Fuel and Convenience Centre ($5.8m).

“162 Hume is one of the city’s premier office facilities,” said Mr Stewart. “Arcana Capital has a strong portfolio of assets around Australia and this purchase adds to their commitments in the city.

“Toowoomba’s population has eclipsed 180,000 and is forecast to reach call 210,000 in the next 15 years. Health remains our biggest employer, but we also have very buoyant mining and agricultural industries.

“The city has benefited from major infrastructure additions and future projects like the Inland Rail, new Toowoomba Hospital and sustainable energy infrastructure will support the ongoing growth of the city and wider region.

“All this infrastructure is supporting a commercial property market where you can find prime yields above 8% and that’s attracting the interest of investor from all over Australia.”