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Virgin Blue Lands Sunland Brisbane Commercial Development For $61 Million


International developer Sunland Group Limited (ASX: SDG) has announced the presale of a commercial development at Bowen Hills in Brisbane to Virgin Blue Limited (ASX: VBA) for $61 million.

The campus-style development, which features a net lettable area of approximately 12,400 square metres, will become the new national headquarters for the Queensland-based airline group.

Virgin Blue has exclusive naming rights to the development, which is currently under construction and scheduled for completion in March 2008, with a further customised fit-out to be completed by August 2008. Virgin Blue will relocate from its current offices at 131 Barry Parade in Fortitude Valley.

Sunland Managing Director, Sahba Abedian, said the Bowen Hills complex is the first commercial project ever undertaken by Sunland in Brisbane, which has a successful history of developing premium, high-profile residential projects, including Q1 on the Gold Coast.

"This development follows a number of innovative and highly successful mixed-use projects in south-east Queensland, including Aria in Broadbeach, Grand Hotel in Southport and most recently Circle on Cavill, which delivered 12,500 square metres in office and retail space to Surfers Paradise," Mr Abedian said.

"Each of these projects has contributed to the successful rejuvenation of the retail and commercial precincts in these areas.

"We applied our trademark design and architecture to this project to create a commercial office space quite unlike anything else on offer in the Brisbane market.

"The development comprises three office buildings, each with three levels, at 56 Edmondstone Road at Bowen Hills in the inner northern fringe of Brisbane's CBD.

"The multi-level campus style design capitalises on the building's prime position on the Breakfast Creek waterway, increasing its visibility, appeal and amenity.

"It will also provide 160 car parking spaces."

"Following this sale, we will continue to expand our activity in the commercial property sector in south-east Queensland, particularly in areas such as the Brisbane CBD and fringe markets where supply is at an historic low."

The 9,302 sq m site was acquired by Preston Grove Pty Ltd, a subsidiary of Sunland Constructions, in late 2005 for $8 million.

The presale to Virgin Blue was finalised on behalf of Sunland by Jonathan O'Brien, Managing Director of CB Richard Ellis Brisbane CBD, while Angus Harvey Ross of Corporate Property acted for Virgin Blue.

Virgin Blue CEO, Brett Godfrey, said the purchase of the high quality office building on the fringe of the Brisbane CBD would provide numerous benefits to the airline.

"Since Virgin Blue was established in Brisbane in 1999 our operations and team have increased significantly. Needless to say we have more than outgrown our current premises," Mr Godfrey said.

"This is a significant investment in providing our people with a contemporary working environment, which reflects our brand and future direction.

"Given the current demand for high quality and sizeable office space in Brisbane, we're pleased to have been able to secure such an ideal property.

"The campus-style accommodation at Bowen Hills will provide us with the space we need to continue our expansion, in close proximity to the CBD and the airport."

Sunland's portfolio now totals $5.5 billion with the international portfolio representing close to $3 billion of this total.

In February Sunland upgraded its full year profit outlook to $85 million (previously $80 million) and forecast a full year dividend of 13.5 cents per share.