This article is from the Australian Property Journal archive
GPT has offloaded industrial business parks in western Sydney’s Camelia and Port Melbourne for more than $256 million to private equity firm and asset manager NashCap.
The combined sale price represents a 1.5% discount to book valuation as at the end of June, and a 9% premium to book valuation at the end of 2021. GPT said it had “added significant value to each of these assets through recent successful leasing”.
Settlement of the transaction is expected by early 2023.
Among the assets are the 41,900 sqm Rosehill Business Park in Sydney, which has three warehouses leased national tenants including Linfox and Australian Pharmaceutical Industries with a weighted average lease expiry (WALE) of 1.3 years.
The Port Melbourne asset, the Citiport Business Park at 650 Lorimer Street, comprises a modern office building and 10 warehouse and showroom buildings. It has a building area of 26,900 sqm has is 84% occupied with a circa three-year WALE.
GPT will use initially capital proceeds from the divestments to pay down debt. It has five logistics projects scheduled to complete over the next 12 months amongst its overall development pipeline.
In recent months, NashCap partnered with the Lowy family-backed Assembly Funds Management to buy the Evo apartment block in inner Melbourne’s Parkville from the Victorian government for about $65 million, while earlier in the year as part of a joint venture with BlackRock earlier this year it bought the Kirby Industrial Park in Sydney’s Rockdale for $121 million.
NashCap and BlackRock’s JV, Urban Logistics Co., was established in 2019 and currently boasts a portfolio with an end value in excess of $1 billion, across nearly 30 warehouse assets in Sydney and Melbourne, with 45 unique tenants. It is targeting a portfolio of $2 billion in the next five years, through a strategy of acquisitions and development of existing portfolio landbank.
After a year dominated by mega portfolio sales in 2021, industrial transactions have slowed in 2022. Over the first nine months of the year, industrial transactions across the country were down 29% in annual terms to $15 billion, according to Real Capital Analytics (MSCI) head of real estate research, Pacific, Benjamin Martin-Henry, who spoke about the movement this week on Australian Property Journal’s latest Talking Property podcast.
Martin-Henry said rising interest rates has seen the bond rates and industrial yields spread narrowed significantly from 300 basis points to 25 bps, suggesting a repricing of industrial assets could be in store.
