This article is from the Australian Property Journal archive
WITHIN days of picking up the four ALDI logistics properties, Charter Hall has paid $115 million for the Winc national distribution centre in Sydney’s Erskine Park, taking its industrial portfolio further beyond $10 billion.
The asset will be held in the Charter Hall Prime Industrial Fund (CPIF) and Charter Hall Direct Industrial Fund No.4 (DIF4).
On a site of 8.283 hectares, the facility at 40-66 Lockwood Dr has a gross lettable area of 43,085 sqm, including 3,000 sqm of office space, and was originally developed in 2008 for Winc as its national distribution centre. The company has entered into a new 12-year lease from expiry of their current lease in August at a net rental of $5.175 million per annum, with
3.25% annual increases and a mid-term market review in 2026.
The property also benefits from two truck access driveways and all-weather super awnings located along both the eastern and western elevations.
Winc, previously known as Staples and Corporate Express, is a supplier of office essentials, furniture, safety equipment, IT solutions, toiletries and kitchen products. Charter Hall said its key customers are “cycle resilient industries, including corporate, healthcare, education and government”.
The off-market transaction, handled by Savills agents Michael Fenton, Michael Wall and Alison Spiteri on behalf of Melbourne based Kador Group, reflected a 4.75% core cap rate.
Fenton said the sale reflects the continued strength in the industrial and logistics sector relative to other asset classes, and the investment thematic of core logistics assets being a safe and stable investment class, even during the current market uncertainty resulting from the Covid-19 pandemic.
“Investors will continue to focus on the sector, and more so now given the current economic turbulence, with the hallmark of strong, secure, and growing income streams.”
In the largest industrial deal of 2020 to date, the $6 billion CPIF and Allianz Real Estate have just teamed up to buy four Aldi distribution centres along the east coast in a $648 million sale and leaseback deal. Each has a seven-year lease back initial terms plus multiple seven-year options, and the deal was struck on a yield of circa 4.75%.
Charter Hall’s industrial and logistics portfolio has a $1.3 billion pre-leased development pipeline and selective acquisitions and is now 90% weighted to the eastern seaboard.
Richard Stacker, Charter Hall’s industrial and logistics chief executive officer, said the acquisition of Winc’s Erskine Park facility was consistent with both the group’s and funds’ strategy to acquire core logistics properties leased to good quality tenants on long term leases situated in key industrial precincts with access to major infrastructure and transport networks.
Fund manager of CPIF, Richard Mason, said the acquisition provided a rare opportunity to secure a major logistics facility in the tightly held western Sydney growth corridor that is supported by convenient access to M4 & M7 Mwys and major infrastructure projects underway including the Badgerys Creek Aerotropolis.
DIF4’s industrial portfolio is approaching $800 million, with a weighted average lease expiry of circa 10 years.
