This article is from the Australian Property Journal archive
A PRIVATE Sydney-based investor has spent $42.08 million acquiring two Acacia Ridge industrial assets previously held by collapsed mining group Arrium.
Across 10.3 hectares, the adjoining properties, at 134-160 Ingram Road and 220-240 Bradman Street, have long-term leases to Austube Mills and OneSteele Reinforcing for a weighted average lease expiry of more than nine years and annual return of $3.3 million.
They were sold through administrators KordaMentha following a campaign handled by Colliers and JLL.
Both companies were acquired by GFG Alliance, founded and owned by the Britain’s ultra-wealthy Gupta family. Sanjeev Gupta purchased Arrium from KordaMentha in 2017 for around $700 million, which included the Whyalla steelworks in South Australia and mini-mills in Sydney and Melbourne.
Arrium suffered a $1.9 billion loss in 2015 and was put into voluntary administration the following year.
The Austube Mills property covers 44,547 sqm over two titles and comprises several buildings with total gross floor area of 25,471 sqm. An active rail siding at the site’s rear provides direct access to the Acacia Ridge rall yards.
Over the rails, the Bradman Street property comprises multiple freestanding structures, including a main building of 9,239 sqm, another office and warehouse facility, a small office building and car park, over three titles on a 58,600 sqm site that includes 23,791 sqm of unimproved vacant land with development potential.
Terms of the sale were agreed in late in 2018, with the settlement delayed until this month to process the title change from leasehold to freehold.
“Opportunities to purchase quality industrial stock in Queensland and Australia-wide are limited and competition among investors is building, particularly as institutional capital seeks greater exposure to the sector,” the agents said. “Assets that offer strong leasing covenants are keenly sought, as evidenced by the Acacia Ridge portfolio sale process. Investors see portfolio transactions as a strategic channel to secure assets of scale when stock is scarce.”
Australian Property Journal