Exceed Capital's FS Property Trust offered sophisticated investors an opportunity to acquire 26 Flinders Street. The deal was arranged together with Knight Frank Adelaide and CBRE.
Managing director and co-founder Vaughan Hayne said the opportunity complemented the firm's first successful acquisition in South Australia, 19 Grenfell Street, and showed strong investment confidence in the state's core business corridor.
Adelaide continues to have a strong and diverse economy, and the market fundamentals keep presenting great opportunities. - Vaughan Hayne, Managing Director and Co-Founder
Following thorough due diligence on 26 Flinders Street, Exceed Capital raised funds through the FS Property Trust to acquire the asset for investors.
Why investors are looking at commercial property
Mr Hayne said that when Exceed Capital completed its first Adelaide CBD acquisition in late January 2025, he noted it wouldn't be the last. By 2026, more investors were looking to diversify away from residential property. They wanted the steady income and long-term growth commercial property offers, and could trust Exceed Capital to deliver based on a 10-year track record.
What stands out about 26 Flinders Street
"What we found with 26 Flinders Street is an annual cash return of approximately 8 per cent and an opportunity to purchase at around 50 per cent below replacement cost," Mr Hayne said.
The vendor had recently completed upgrades worth approximately $10.7 million, including a new lobby, end-of-trip facilities, lifts and air conditioning.
At the time of the raise, income was secure and diverse, with 24 tenants including ASX-listed and multinational companies, and 91 per cent occupancy. A shorter WALE allowed for a rent uplift when tenants renewed. Exceed Capital also planned a CapEx fund for remaining minor works and value-add opportunities, such as a courtyard plaza and a future development parcel.
Why Adelaide
Our investment thesis has remained unchanged: buy well, manage actively and stay aligned with our investors. - Vaughan Hayne, Managing Director and Co-Founder
Adelaide aligned with that approach, Mr Hayne said, given it had the highest employment growth of all Australian capital cities, plus long-term demand for quality office space from the state's defence, technology and resources sectors.
A second Adelaide acquisition added to Exceed Capital's nationwide portfolio, which stood at 17 assets after a decade of doing business.
Partners
Exceed Capital worked in partnership with Knight Frank Adelaide's Max Frohslich and Ryan Mills, and CBRE's Ian Thomas and Alistair Laycock.
Key facts and figures at launch: 26 Flinders Street, Adelaide CBD
- Projected cash return: approximately 8% P.A., paid monthly
- Approximately 50% below replacement cost
- Capitalisation rate (fully leased initial): 9.08%
- Minimum investment: $100k
- Trust structure: close-ended, 5-year term
- Occupancy: 91% across 24 tenants
- Tenant retention: over 50% of tenants in their second or third lease terms
- Net absorption: up to five times the 10-year average
- Recent capital improvements: $10.7 million
- Office space: 10,217 sqm across 700 sqm floorplates
- Parking: 68 secure basement car spaces at 1:150 sqm
- Energy rating: 4-Star NABERS
- Building: 16 levels
- Exceed Capital portfolio: 17 assets nationwide
About Exceed Capital
Established in 2016 and privately owned in Brisbane, Exceed Capital is a trusted and recognised fund manager across Australia, founded on the core principle of alignment with investors. It is committed to sustainable income, strategic growth and transparent communication.
For more information on the FS Property Trust, visit exceedcapital.com.au/fs-property-trust
This summary was created by Exceed Capital Pty Ltd ACN 612 185 823, AFSL 490284.The summary is intended only for the person to whom it has been delivered and should be read in conjunction with the Information Memorandum and should not be relied upon as an independent source of information. The content of this summary is confidential and this information and all matters connected with and relating to this investment opportunity in for Sophisticated/Wholesale Investors only and should not be disclosed to a third party without consent from Exceed Capital Pty Ltd. It is not intended that this summary be used or relied upon for any purpose other than to inform potential investors about the subject opportunity. Potential investors should seek to access the Information Memorandum for further information. All statements and opinions in this summary are given in good faith and in the belief on reasonable grounds that such statements and opinions are correct and not misleading. No responsibility is accepted by Exceed Capital Pty Ltd, directors, officers or employees for any errors or omissions.This document contains information of a general nature only and does not take into account your investment objectives, financial situation or particular needs. Investment returns are not guaranteed and past performance of a Trust is not a reliable indicator of future performance.
