Logistics boom sparks $110m Sydney industrial portfolio sale

Private equity group Blackstone and funds manager Charter Hall are tipped to follow suit.

The companies are selling off unwanted assets as their rivals chase a position in the sector that almost all listed property players called out as a priority in the most recent reporting season.

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AMP Capital is selling 104 Vanessa St, Kingsgrove, 64 Biloela St, Villawood and 30-32 Bessemer St, Blacktown, after picking up a larger portfolio in mid-2016 from JPMorgan.

It is taking the three prime industrial and logistics Sydney assets to market via Colliers International’s Gavin Bishop and Sean Thomson and JLL’s Tony Iuliano, Adrian Rowse and Greg Pike.

They sit near arterial road networks and will benefit from surrounding government infrastructure projects over the next four years.

The properties have a building area of about 50,510sq m and a site area of 94,140sq m and spin off a net passing income of $5,848,713 per annum.

Bishop says the portfolio’s scale, strong lease covenants and weighting to Sydney would be key selling factors and be well received by the global investment market.

“We anticipate significant demand for this portfolio given the low interest rate environment and robust economic fundamentals in Australia, as well as the weight of capital chasing industrial investments,” he said.

Tenants include Shriro, VIP Plastic Packaging and Snack Brands Australia.

Iuliano says lower investment volumes last year have been a symptom of reduced stock availability rather than a reduction in demand.

“Domestic and global players are vying for industrial opportunities of scale in Australia and the weight of capital ready to deploy into industrial and logistics assets is estimated to be $21 billion,” he says.

This article originally appeared on www.theaustralian.com.au/property.