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Commercial Office Fund debt reduction strategy
09 February 2009
Orchard Funds Management (Orchard) has today confirmed two prominent Melbourne office towers have been put on the market, as part of an ongoing debt reduction strategy that commenced in January 2008. The properties, 350 Collins Street and 600 St Kilda Road, are owned by the Orchard Commercial Office Fund (the Fund).
Orchard CEO David Hinde said, “In 2009 we will continue to strongly position our funds against further weakness in the market. This demands a firm focus on repaying debt and conserving cash in our funds and we will proactively sell assets where we feel it is appropriate and in the best interest of our investors”.
- 350 Collins Street is a prominent 17 level office tower located in the heart of the financial precinct of the Melbourne CBD. The property comprises 17,800 square metres of office space and ground floor retail outlets. The property was acquired by the Fund in 2005.
- 600 St Kilda Road is a 15 level ‘A grade’ office building located on a prominent corner position in the St Kilda Road office precinct. The property was acquired by the Fund in April 2006.
The marketing of 350 Collins and 600 St Kilda Road is an important part of the Fund’s deleveraging strategy. According to Mr Hinde, “A successful sales campaign will put the Fund in a stronger position by helping to ease its LVR (loan to value ratio) and debt position”.
The Orchard Commercial Office Fund has $436 million of assets under management and boasts a strong tenant mix with a balanced lease expiry profile. The properties are being marketed through Jones Lang LaSalle and Colliers respectively.
Click here to download a copy of the media release.