Developer and fund manager Commercial & General will put a $20 million suburban office complex into one of its investment funds after purchasing the troublesome property from the South Australia government.
As part of the deal, Commercial & General has signed up information technology group Hewlett-Packard on a long-term lease running until 2025 for the office building on O G Road in Felixstow in north-eastern Adelaide.
Commercial & General managing director Jamie McClurg said the long-term plan involved an expansion of the building’s footprint.
Investors would be offered the chance to be part of the deal via one of the group’s investment funds.
“We’ll put it into one of our investment funds,” Mr McClurg said.
The building is about 6 kilometres from the Adelaide CBD.
It has had a chequered history, with the former state Liberal government building the $25 million complex as a back-office administrative centre for stockbroking and investment banking firm JPMorgan in 2001 as part of a drive to try and expand an ailing local financial services sector.
However, JPMorgan upped stumps in late 2004 before the lease expired. The site was then leased to Air Warfare Destroyer Systems as an operations centre. Air Warfare Destroyer Systems, which is building warships under an $8 billion contract, moved to the Techport site in late 2010 near Port Adelaide, where the ships are being built.
The building has been vacant since February 2011, when the state government took control of the site again.
Hewlett-Packard will be relocating staff from another site in suburban Adelaide.
Mr McClurg declined to comment on the price.
Market estimates put the sale price at about $20 million.