Alceon buys Mirvac's 410 Ann Street towers for $124m

Alceon exchanged contracts on Wednesday to buy Mirvac’s twin-tower office complex at 410 Ann Street, on the northern fringe of the Brisbane CBD, together with the adjoining Cathedral Square car park, for $124 million. The combined holding spans more than 20,000 sqm of net lettable area on a 4,052 sqm freehold site, about 90 per cent leased on a four-year weighted average lease expiry.

Alceon is a private investment manager that funded the deal through its network of high-net-worth and wholesale investors. Alceon said the purchase is its 15th Brisbane office investment and that its Queensland team now manages more than $1.25 billion in real estate. Alceon said Mirvac sold through a separately managed account but did not name it, as reported by Mingtiandi.

Why it matters

Brisbane CBD office vacancy fell to 10.2 per cent in July, the lowest of any Australian capital, according to Property Council data. JLL puts prime gross effective rents up 11.8 per cent year on year and 47 per cent since 2022. That combination is pulling capital back into secondary-grade city stock that was unloved only a few years ago. Alceon’s own numbers on this deal show why: a fully leased yield of about 11 per cent, and a price near $6,000 a square metre that falls under $4,000 a square metre once the oversized car park component is stripped out. Alceon said it paid a substantial discount to replacement cost. For Brisbane owners of B-grade stock, the deal sets a fresh value-add benchmark. Todd Pepper, the managing director who heads Alceon’s Queensland business, said of the asset: “This is a well-located asset that has been under-managed for some time.”

The numbers

The twin towers and Cathedral Square car park sold for $124 million combined. The office component carries more than 20,000 sqm of net lettable area on a 4,052 sqm freehold site, about 90 per cent leased with a four-year weighted average lease expiry, and named tenants including the Public Trustee of Queensland, First Parking, Mipac, Sonic Healthplus and Dye & Durham. The complex sits about 375 metres from Central Station and holds a 5.5-star NABERS Energy rating and a 3.5-star NABERS Water rating. CBRE and JLL brokered the sale. The car park adds 139 bays inside the towers plus 572 bays on the separate 8,949 sqm Cathedral Square leasehold, which runs until April 2108. Almost half of the complex’s floor space rolls over for lease renewal in 2028 and 2029, the window in which Alceon’s return on the deal will largely be decided.

What’s next

Alceon’s stated plan is to upgrade the lobbies, common areas and vacant floors to a contemporary B+ standard, then lease up the roughly 10 per cent vacancy and push rents that it says are currently well below market as the 2028 and 2029 lease expiries approach. No settlement date beyond this week’s exchange has been disclosed. The price closely tracks September’s $81.8 million sale of 133 Mary Street by ESR to Quintessential Equity, at about $6,200 a square metre. Prime towers have traded at about double that, including GPT Group’s $400 million purchase of Central Plaza II in April. Earlier this month, Daiken Investment Australia paid $81m for 10 Browning Street, South Brisbane, another fully leased office trade just outside the core.