Mapletree buys up big in Sydney industrial market
Singapore-listed Mapletree Logistics Trust has bolstered its position in the local industrial property market with the purchase of four warehouses in Sydney for $85 million.
The facilities were bought from private equity real estate group Altis Property Partners, which is selling a larger $285 million portfolio of industrial and logistics assets.
The deal was negotiated by Gavin Bishop and Roger Miller of Colliers International, who says the new owner will benefit from the NSW Government pouring $68 billion into infrastructure investment over the next four years.
Mapletree picked up warehouses in Mount Druitt, Smithfield, Wetherill Park and Huntingwood. The assets showed a net property income yield of 7.1%. The tenants include Dulux Group, Sunnyfield, Janala, Tesrol Joinery, Cargo & Logistics Management, NAB and Transport Refrigeration Services.
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The portfolio was part of a larger offering of nine properties across three cities, with seven of the nine assets located in Sydney.
It is understood that property funds house AMP Capital remains in due diligence to acquire the bulk of the remaining assets.
These assets will provide stable and growing income to our unitholders
Separately, entrepreneur Rodney Jane has been identified as the likely buyer of General Motors Holden’s former headquarters in Port Melbourne that Altis is selling for more than $35 million.
AMP Capital is on the hunt for industrial property and is targeting acquisition of a portfolio being sold by JPMorgan Asset Management for about $250 million.
That play came after Asian group e-Shang Redwood pulled back from bold plans to buy three portfolios of Australian industrial property worth almost $1 billion.
The offshore group had also eyed more than $600 million worth of property offered by Goodman Group, which is now in the sights of the Blackstone Group.
This portfolio presented an outstanding and low-risk opportunity for Mapletree Logistics to secure assets in Sydney’s industrial investment market
But other Asian groups continue to chase industrial property.
Mapletree Logistics chief executive Ng Kiat says that acquiring the four properties will “expand our footprint in Sydney to five assets”.
The trust will fund the purchase from the proceeds a recent issue of S$250 million of perpetual securities.
“Fully leased to established local industry players with a weighted average lease to expiry of 5.5 years with fixed annual escalations, these assets will provide stable and growing income to our unitholders,” she says.
Vendors are reaping rewards from selling portfolios as purchasers are offering premiums to grow.
“Given the continuing low interest rate environment and robust economic fundamentals in Australia, this portfolio presented an outstanding and low-risk opportunity for Mapletree Logistics to secure assets in Sydney’s industrial investment market,” Bishop says.
“There is significant demand for industrial investments in Sydney due to sound fundamentals, being diminishing supply of land, increased leasing demand and significant investment in infrastructure by government.”
This article originally appeared on www.theaustralian.com.au/property.
