Centuria Capital Group's (ASX:CNI) World Square purchase appears to be "at odds" with the market's preference for prime-grade assets, and also marks a doubling-down on secondary office space at a time when the company's listed satellite is trading close to an all-time low, Jefferies said in a May 11 note.

The company's purchase of a 21-year-old office asset in a sub-optimal part of the central business district that is roughly 88% occupied represents Centuria Capital assuming a large counter-cyclical view on the Sydney office market, the equity research firm said.

"Convincing listed equity investors of the upside potential, and that it is the right move at this point in the office & rate cycles has been been met with a level of skepticism," Jefferies said.

It added that despite this, the acquisition and associated capital raising would result in an estimated 4% accretion to its fiscal 2027 operating earnings per security forecast for the company.

Centuria Capital likely has its work cut out to lease up the 12% of existing vacancy "in a very challenged mid-town market," but the vendor has issued a two-year rental guarantee over this income, which will help underwrite the targeted 7.5% annual distribution yield in the near term, Jefferies said.

Jefferies maintained a buy rating on the company with a price target of AU$2.50.

Centuria Capital Group's shares were down 1% in recent Tuesday trade.