Half vacant Parramatta office sells for nearly $40 million, despite pandemic ridden market conditions

By Abhati Tarkunde

Sydney based Asian private investor has bought 16-18 Wentworth Street, a Parramatta office building, off market for $40 million from Chandru Tolani and Sanjay Kumar in June 2020.

The initial investment for the building in 2012 was $18 million, which has now doubled for vendors Tolani and Kumar from Chandru enterprises, a company that owns assets such as hotels, childcare centres, commercial buildings and engages in land development and apartment building.

The 100 per cent freehold property was sold by Jay Sethi, Senior Sales Executive, and Victor Sheu, Associate Director, of Ray White Commercial, Western Sydney, on behalf of Chandru Enterprises.

“The Asian capital that’s locally-based is still looking for an opportunity and office assets seem to be a secure stand-out for these buyers right now, it’s a good balance of controlled risk, as well future opportunity to capitalise underlying value,” said Sethi.

“16-18 Wentworth Street is over 50 per cent vacant, but buyers saw potential to add value, despite the COVID-19 overall blanket effect covering the market. The right property will still receive significant attention,” he said.

“This deal is testament that there are still significant funds looking to be placed into the right investment vehicle, despite COVID-19 and the complexity that it has generated across different markets and industries.”

“Despite negative speculation of COVID-19 slowing down the market and the lending market being risk-averse and tight, we have historically low interest rates and quality assets with potential upside either in immediate uplift or future redevelopment, are extremely attractive.”

The property was built in 1991 and offered a 6,408sqm* NLA and 1,333sqm* site area in the vibrant commercial suburb of Parramatta, which has now become a vast business hub, with fast economic development taking place.

“Parramatta is absolutely thriving, with Parramatta Square coming on really well, and the recent announcement of Parramatta Metro as well as the Light Rail on its way, there are always keen investors looking at getting into this market,” said Sheu.

“Parramatta provides businesses and investors a strong alternate option to the traditional CBD, as well as North Sydney’s high prices,” he said.

“This has led to higher demand for commercial space in Parramatta particularly of good location, other majors such as Walker and GPT are both building their commercial towers now, with Scentre Group’s tower well-progressed in the planning process.”

The property’s location and amenities are predicted to attract tenants with various business agendas.

“This asset is a stone’s throw away from both Parramatta Station and Westfield. The amenity, as well as efficient floor plates will attract an array of tenants, particularly professional services and education due to its proximity to both public car parking and amenities,” said Sheu.