This article is from the Australian Property Journal archive
CHARTER Hall has taken its spend on industrial logistics facilities across the funds management platform to over $1 billion since June, acquiring a 30.6 hectare automotive logistics park in Sydney’s Minto from Qube for $207 million.
The property will be held in the $6 billion Charter Hall Prime Industrial Fund and a global institutional partnership managed by the group.
The deal was struck on a yield of 4.76% and is subject to Foreign Investment Review Board approval. It follows Charter Hall purchases of four ALDI logistics properties along the eastern seaboard in partnership with Allianz for $648 million, and of the Winc national distribution centre in Erskine Park for $115 million.
Located at Culverston Rd in south-west Sydney, the Minto property is predominantly cleared level land and utilised as car import, storage and distribution. It is fully leased to Mazda, CEVA, PrixCar and Dial A Tow with an average lease expiry of 4.2 years.
The site has a state significant development approval for up to 112,000 sqm of warehouse development and a rail siding on the site, which provides connectivity to the Southern Sydney Freight Line running parallel to the eastern boundary and enables the development of an intermodal rail terminal.
“The property presents a unique opportunity to acquire a rare 30.6 hectare benched, serviced and zoned industrial development site in a core Sydney industrial precinct, with a staggered lease profile which provides holding income and enables a potential stage build out into a key logistics and intermodal facility,” Charter Hall Industrial & Logistics chief executive officer, Richard Stacker, said.
“The construction of Sydney’s second international airport at Badgerys Creek, major federal and state government infrastructure spending in western Sydney and the streamlining of supply chains continues to drive the demand for well-located logistics facilities in western Sydney.”
As well as the freight line, Minto offers access to major transport corridors the M5 Mwy, M7 Mwy and Hume Hwy.
Charter Hall chief investment officer Sean McMahon said the acquisition upweights the group’s $10 billion-plus logistics portfolio to Sydney and extends existing tenant relationships with Mazda, CEVA and PrixCar.
“Both CPIF and the institutional partnership have core and develop to core strategies, with this site providing short and longer-term develop to core opportunities with a spread of lease expiries.”
This acquisition, combined with recently announced logistics transactions, grows its industrial and logistics portfolio by $1 billion since the start of June, “further extending our strategy of becoming a leading player in the Australian industrial market”, group CEO and managing director, David Harrison said.
Charter Hall Retail REIT turned heads earlier this month, stepping away from its typical shopping centre targets to buy a 52% interest in Coles’ South Australia and Northern Territory distribution centre in Adelaide, and which followed the divestment of Pemulwuy Market Place and West Ryde Market Place shopping centres for $126.5 million.
Heavy hitters including Stockland have been moving away from major retail assets and to the industrial and logistics sector.
Dexus and GIC’s logistics trust has just spent $173.5 million acquiring two new logistics facilities, including a cold storage facility in Sydney and Ford’s spare parts national distribution centre in Melbourne. International investors are also taking notice of Australia’s logistics sector, Singapore’s Ascendas acquired a Yennora facility last week. South Korea’s pension fund is also looking to invest in the sector and Singapore’s ESR Cayman launched a $1 billion fund targeting prime logistics in Sydney, Melbourne and Brisbane.
ASX-listed Qube has been assessing funding and ownership options for its significant real estate portfolio, including Minto and the yet to be completed Moorebank Logistics Park, which at 243 hectares is the largest in Australia.
Moorebank is valued at up to $2 billion and is being developed on land that is owned by the commonwealth and next to land held by Qube.
