Stirling Street site delivers strong returns for investors
Posted 19 . 01 . 15
Stirling Capital has almost doubled its forecast returns for investors in one of its investment syndicates in Perth’s booming Stirling Street precinct.
Investors were rewarded with an internal rate of return of almost 17 percent over three years – well above the projected average cash yield of 9.3 percent per annum.
The 2,262 square metre site at 108 Stirling Street was purchased by Stirling Capital in 2012 for $7.55 million. As part of a strategy to add to the site’s value, council approval was secured to develop 168 residential apartments.
The existing single-level office building was acquired with a long-term Government agency lease in place, providing investors with a low-risk commercial property investment opportunity.
Stirling Capital Director Luke Reinecke said this particular site, on the corner of Aberdeen Street, stood out as a drawcard for investors for a number of reasons.
“The Stirling Precinct has been undergoing a massive transformation in the past couple of years and this has had a positive impact on capital growth in the area, outstripping many suburbs of Perth and regional Western Australia,” Mr Reinecke said.
“Recent changes in zoning are driving development and transforming the area into a highly desirable place to live and work, and with the billions of dollars worth of infrastructure projects underway within walking distance of Stirling Street, including King’s Square and the Perth City Link, we expect the gentrification of this area to continue.”
The next phase of the project will see the site developed into a $100 million energy efficient residence by Stirling Capital, featuring 168 one- and two-bedroom apartments over 21 levels designed by MJA Architects. Apartment sales will launch in mid 2015, with building completion aimed for 2018.
The development of 108 Stirling Street follows the company’s recent sales launch of nearby Verdant Apartments, a development that will set the standard for green-living in Perth’s CBD.