Centuria spends $171.1m on cold storage portfolio

The Derrimut asset (above) and Parkinson property (below) are each costing Centuria Industrial REIT $49 million.

Centuria Industrial REIT (CIP) has spent $171.1 million on three Australian east coast cold storage investments.

The deal is being struck on a blended 5.62 per cent yield.

The Parkinson property in Brisbane is tenanted to Rand Transport.

All properties are occupied, to either national or international businesses.

One of them was acquired as a leaseback.

The portfolio’s Weighted Average Lease Expiry is 6.4 years.

CIP will now seek a $125m institutional placement to help fund it.

The properties will boost the income the trust derives from its non-discretionary, food distribution and cold storage facilities, to 33pc.

The buyer’s manager, Centuria Capital Limited, has spent $1.1 billion on industrial assets since last November.

The three cold storage investments

The most valuable new property, 67-69 Mandoon Road, Girraween, west of Sydney, six kilometres from Parramatta (pictured, top), is costing $73.1m as part of a seven year leaseback deal with Bidfood.

With 25,418 square metres of area, it occupies a 4.9 hectare site the landlord has identified as located in “a key infill industrial market”.

The vendor offered to pay starting annual rent of $3.75m – meaning this deal is being struck on a 5.1pc return.

CIP’s other two cold storage investments – 45 Fulton Drive, in Melbourne’s west Derrimut, and 60-80 Southlink Street, in Parkinson, south of Brisbane – were each purchased for $49m (story continues below).

All up these properties contain 20,000 sqm of area and are leased to Rand Transport.

The Victorian asset’s WALE is 5.8 years compared to Queensland’s (6.1 years).

JLL’s Tony Iuliano was the agent.

CIP’s profile has risen this year

CIP’s portfolio now includes 59 assets worth $2.3b.

Vacancy is 3.4pc; the WALE is 9.7 years.

“The cold storage portfolio acquisition reaffirms [the trust’s] position as Australia’s largest listed pure-play industrial and logistics REIT,” a company statement said.

Last month the group spent $43m on an Ormeau property occupied by Markwell Cold Storage near the Gold Coast.

In September the fund outlaid $32.5m on two commercial investments – another in Fulton Drive, Truganina – the other in Brisbane (in south east Coorparoo).

A month earlier it acquired Clayton data centres from Telstra as part of a 30 year leaseback deal for $416.7m.

Last December it snapped up Adelaide and Brisbane manufacturing plants – again from the occupier, in that case Arnott’s – following a $236.2m outlay.

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Marc Pallisco

A former property analyst and print journalist, Marc is the publisher of realestatesource.com.au.