This article is from the Australian Property Journal archive
HOT on the heels of industrial and logistics acquisitions in Sydney’s Brookvale and Prestons, national fund manager Centennial has set its sights north to the sunshine state, outlaying $63.45 million for three new last mile and urban infill sites.
The sites are located in Brisbane’s inner-ring suburb of Alderley, in Murarrie, in the Australia TradeCoast precinct, and the infill western corridor suburb of Riverview.
All three sites possess strong value-add or redevelopment potential and were acquired off-market through Centennial’s new $700 million Enhanced Value Partnership (EVP) Fund, launched this year with Brookfield, and have a combined on-completion value of $158 million. That will increase the EVP Fund’s portfolio to eight properties worth in excess of $307 million.
Centennial has also just spent $163 million on the assets in Brookvale and Prestons for its EVP Fund.
The largest purchase of the new Queensland trio is the facility and development site at Riverview, for $38.5 million. It includes a 14,680 sqm warehouse, fully leased to Ausco until February 2025, plus a six-hectare hardstand area with development potential to create a circa $130 million estate.
The off-market sale was negotiated directly with a private vendor.
“The fund will reposition the existing building into multiple, flexible tenancies and develop the balance of the 12-hectare site in line with our strategy of adding value to creating high-quality, flexible, mid-space I&L estates with institutional appeal,” said Paul Ford, Centennial’s executive director and CEO industrial & logistics.
The 9,089 sqm site Alderley site, five kilometres from Brisbane’s CBD, is fully occupied by a Boeing Company subsidiary. It was purchased by the fund for $13.7 million in an off-market deal negotiated by Anthony White of Colliers on behalf of a private vendor.
The core plus site at 95 Mina Parade contains modern office and warehouse facilities with a gross lettable area of 5,945 sqm, together with extensive car parking areas. The site is primed for future redevelopment given its inner-ring location and nearby rail access, Centennial said.
It has also picked up the 11,440 sqm site at 980 Lytton Road in Murarrie purchased for $11.25 million, in another off-market deal. The site is located in the heart of the Australia TradeCoast industrial precinct and offers a 3,535 sqm fully-leased modern warehouse and office facility. The site also offers potential for a 1,940sq m speculative build with building designs well underway with an on-completion value of $24 million.
Ben Lyons of CBRE negotiated the sale on behalf of a private vendor.
Ford said the fund’s latest acquisitions were an ideal fit for the EVP investment vehicle given each ticked all the boxes for their urban, land constrained locations with multiple value-add or redevelopment options.
“Our strategy of deliberately targeting mid-space undercapitalised assets through off-market deals and identifying assets that need specialised management will continue to underscore our niche industrial and logistics strategy, while delivering enhanced returns to our investors.”
The fund typically targets estates and buildings comprising tenancies between 1,000 sqm to 10,000 sqm within established inner ring, urban and land-constrained corridors and valued between $10 million to $75 million upon stabilisation or redevelopment.
“This market is often overlooked by institutional investors given the management intensity and scale requirements at the time of purchase…this is a space where Centennial is set up to acquire, execute and manage,” he added.
In July, Centennial and joint venture development partner MaxCap Group kicked off construction on their $100 million speculative industrial development Link Industrial Park project at Willawong in Brisbane’s south.
