This article is from the Australian Property Journal archive
SINGAPORE-listed Mapletree Logistics Trust has snapped up a red meat cold storage facility in Melbourne’s western suburbs for $43 million amid full occupancy across the sub-sector.
The Laverton North property at 5-17 Leslie Road and 6-10 Pipe Road has a net lettable area of 14,747 sqm, and is composed of five blocks of cold and freezer warehousing, spanning 77% of the property, ambient warehouse, office and other amenities.
The property is entirely leased to Austco Polar Cold Storage for the storage, packaging and export of red meat products for another 13 years with annual rent escalations. It was valued at $43.0 million by Knight Frank in June is expected to generate an initial net property income yield of 4.3%.
Austco Polar is a wholly-owned subsidiary of ASX-listed Wingara AG Limited and is a national and international exporter that provides blast freezing, storage and distribution services.
“The e-commerce, food and grocery sectors recorded strong growth in 2020. This in turn has supported robust demand for cold storage facilities. Despite the sector’s recent growth, Australia has a relatively low supply of cold storage facilities as compared to other developed markets,” the trust said.
The transaction was handled by Dawkins Occhiuto’s Andrew Dawkins and Chris Jones, and JLL’s Tony Iuliano and Andrew Prowse.
A report from Global Cold Chain Alliance showed Australia’s per capita cold storage stock in 2020 lags three to four times behind developed countries such as the US, UK and Canada, and consequently, there are no vacant cold storage warehouses of more than 5,000 sqm across the country.
Institutional and private capital has sought out similar facilities over the past 12 months. Charter Hall’s wholesale industrial and logistics fund acquired a portfolio of 25 cold storage and food distribution centres in a $270 million sale and leaseback deal with PFD Food Services in May, while South Australian property developer and investor 1835 Capital bought a cold storage facility in Adelaide’s west for $41.5 million from another Singapore-listed group, ARA Logos Logistics Trust in April.
Late in 2020, Centuria Industrial REIT picked up three facilities on the east coast for a combined $171.1 million on an initial yield of 5.62%, with a weighted average lease expiry of 6.4 years.
In August last year, Frasers Logistics & Commercial Trust sold its 50% stake in a Brisbane chilled facility to global real estate investment manager DWS for a cool $152.5 million – 12.2% above book value.
Mapletree Logistics Trust also bought a Brisbane distribution centre in October for $114 million on a sharp yield of 4.9%.