This article is from the Australian Property Journal archive
WESTERN Australia-based Mair Property Funds has acquired the purpose built Perth facility of Bunnings supplier Timberlink, in a $12.4 million deal with Sentinel Property Group.
The Canning Vale asset will be first for the commercial fund manager’s recently launched MPF Diversified Fund No.3, targeting the acquisition of up to $80 million worth of assets across Australia.
Alex Gismondi of Transact Capital handled the sale of the 7,773 sqm warehouse and office at 13 Modal Cr, which exchanged off-market on a yield of 6.09%.
It has a land area of 1.88 hectares and features an office and warehouse building that was constructed in 2008, and is strategically positioned close to the main freight route of Roe Hwy, allowing easy access to ports, Perth Airport and other main transport routes.
For Sentinel, the deal represents a tidy profit on the $10.1 million it forked out for the asset at the end of 2017.
“The Canning Vale industrial estate has become a destination for distribution centres and contains a component of showroom and light industrial uses,” Sentinel executive chairman and chief investment officer, Warren Ebert said.
“The decision to sell this asset was based on Sentinel’s strategy of buying at an opportune time and then selling based on our view of the market.”
Alex Lambert, head of commercial funds at Mair Property Funds, said investors are beginning to recognise the benefits of spreading capital across different markets and sectors to reduce their investment risk and leverage broader capital growth opportunities.
He said the purchase, purpose-designed and tenanted by the wholesaler, represents an excellent initial asset for the fund.
“The asset is secured by an 11-year lease with Timberlink, who are a key supplier to Bunnings, so we’re confident this asset will provide strong long-term income security to our investors.”
Timberlink Australia is a subsidiary of New Forests and has been at the property since August of 2010, with a remaining lease term of 10 years.
“In addition, the continued growth in e-commerce retail is providing a significant tailwind and we have identified burgeoning demand for high-quality industrial properties, particularly well-located distribution facilities such as this that meet the demands of modern tenants in terms of fit-out and design,” Lambert said.
The new fund is targeting annual distributions of 7.5% per annum.
Mair recently closed out MPF Diversified Fund No.2 at $60 million with the final two asset purchases completed in May.
Sentinel has two remaining assets in WA, including the Geraldton Homemaker Centre, which it bought for $27.3 million in 2015, and the Port Hedland Boulevard Shopping Centre, picked up for $17.5 million a year later.
