PNG clans buy Brisbane tower for A$38 million
In a move that rivals indigenous people’s business investments in countries like New Zealand, a set of clans from Papua New Guinea’s<!--more--> relatively remote group of islands in Lihir last week acquired a substantial building in Brisbane’s business district.
This is the largest single investment by any PNG indigenous company in Australia. Mineral Resources Lihir Capital, the investment firm that acquired the building was first set as a trust representing six indigenous tribes from the Lihir islands up by the PNG government to manage their collective wealth acquired from mining operations in their islands. It became an independent company engaged in investments in 2008, representing the interests of the six clans.
MRL acquired the 17-storey Flight Centre Tower for A$38 million dollars. Eighty-six per cent of the property is currently tenanted across 14 levels, three of the lower levels being dedicated to parking. The building, located at 316 Adelaide Street, has an area totaling more than 7400 square metres.
The tower gets its name from its anchor tenant, one of Australia’s largest travel companies, which occupies 11 levels and holds a decade long lease. Other high profile tenants occupy other levels of the building, which returns an impressive 9 per cent yield, according to the MRL management.
MRL is the result of a prudent investment strategy on behalf of the tribes it represents, numbering some 14,000, following the closure of the Lihir gold mining operations.
Similar investment vehicles were also formed following Nauru’s spectacular phosphate mining success in the 1980s. Unfortunately, though, bad investment decisions and poor management and accounting practices caused big losses and wiped out their value in just about a single decade.