This article is from the Australian Property Journal archive
PERTH-based property funds manager Quadrant Investments is looking to capitalise on the ongoing strength of the industrial market, forking out $8.95 million for 1.84 hectares of underdeveloped land in Perth’s northern suburbs.
Split over two titles, 4-12 Hoskins Road in Landsdale has a total building area of 5,855 sqm, reflecting a site coverage ratio of just 32%. Both properties are leased to a long-term tenant, a wholly owned subsidiary of ASX200-listed Seven Group Holdings, which has occupied the site for nearly 20 years.
According to Quadrant Investment managing director Phil Fogliani, the market outlook, together with the asset’s characteristics, provided the flexibility of adding value in the short term by repositioning via renegotiating the lease over the existing property, with the option of driving further value-add avenues by constructing a new 4,500 sqm warehouse over a portion of the site in the medium to longer-term.
The site has three street frontages with road exposure of over 400 metres that provides multiple access points and both drive-through and around access.
This is the tenth asset Quadrant since launching and will be held in the single-asset QI Value Add Income Trust No 2 after concluding the capital raise for the trust fully subscribed in October.
“The acquisition of 4-12 Hoskins Road provides a unique value-add proposition for our investors, capitalising on the strength of the industrial market,” Fogliani said.
The QI Value Add Income Trust No 2 is aiming to deliver its investors with total returns of in excess of 11% per annum, with normalised income distribution targets of 7%-plus per annum, paid on a monthly basis.
Fogliani said the industrial sector has been a standout performer nationally, and the Perth market demand and absorption leading to strong rent growth.
“While we anticipate that record low yields will adjust in the current interest rate rise cycle, we believe the continuing strength of demand and space absorption will maintain strong growth prospects in the sector.:
Vacancy rates are under 1.0% for established stock in the northern precinct for warehouses over 3,000 sqm.
Quadrant Investments has over $90 million of assets under management, a figure that has doubled since the 109-year-old Richard Noble & Company purchased a 50% interest in the business.
The Landsdale sale was negotiated by Spiro Agapitos, director of Vita Property Group, via an on-market Expression of Interest campaign.
