Perth's first major property deal for 2014 is on the board with Charter Hall selling the office building at 130 Stirling Street for $90 million to a Singapore company.
The A-grade building was purchased by diversified real estate group Hiap Hoe in its first foray into Perth's property market.
The Singapore-listed company said the building's city fringe location in a gentrifying precinct and its leases to five prime tenants made it an ideal investment.
Hiap Hoe said the building's proximity to the CBD also made it a stable source of rental income and would provide an opportunity for the company to increase its presence in Australia.
Charter Hall said the sale represented a market capitalisation rate of about 8.0 per cent
The off-market transaction to Hiap Hoe was negotiated by Paul Craig and Miles Rowe from Savills Perth office.
Paul Craig, managing director of Savills WA and managing director of international investment for Savills Australia, said 130 Stirling Street was a landmark sale for the Perth market.
"Not only is this the first major office transaction in Perth this year, it is also the first sale over $75 million in Perth since May 2013," Mr Craig said.
"It also signals the entry of a major new international investor in Perth, which represents a strong vote of confidence in the property fundamentals and future outlook for the market.
"This building is a showcase of modern, sustainable office accommodation in one of Perth's most dynamic developing precincts."
The 12,350sqm 5 Star Green Star office building was designed by Woods Bagot and developed by Charter Hall in 2009. The property was syndicated in 2010 and Charter Hall's head of direct property Richard Stacker said investors would receive a return greater than 15 per cent per annum over the four years since the fund's launch.
The 130 Stirling Street transaction is subject to FIRB approval and is expected to settle in the second quarter of this year.