Charter Hall has purchased the Auburn Redyard entertainment complex and neighbouring land available for immediate development.
The deal, with Reading Property Group – which operates a 10-screen cinema within the retail component – is worth $90 million.
The investment will be held in the manager’s Prime Industrial Fund (CPIF), now worth c$7.6 billion.
The 4.82 hectare property is diagonally adjacent to a showroom Costco recently acquired for $30.5m to expand its local store.
Auburn Redyard, at 98-100 Parramatta Road, contains 13,671 square metres of lettable area.
The bulk is occupied for the entertainment complex; the retail component includes two pod sites too.
The property also accommodates a Telstra exchange and 727 car parks.
A 1.32ha tract, opposite Vicinity’s Lidcombe Shopping Centre and a Bunnings, and with Nyrang Street frontage, offers significant development upside.
The entire parcel is zoned B6 Enterprise Corridor.
Income + development upside
Auburn is 18 kilometres west of Sydney and this site is about 350 metres from the M4 Motorway on/off ramps.
“The property provides an excellent opportunity for CPIF to acquire a high profile, core infill land holding close to the geographic centre of Sydney with easy access to large consumer markets making the site ideally suited for last mile [industrial] occupiers” CPIF fund manager, Richard Mason, said (story continues below).
“The site represents one of the few opportunities of scale in the tightly held inner west Sydney market, where demand is elevated, vacancy rates are at historic lows and prospects for rental growth are considered strong due to the land constrained nature of the precinct,” he added.
“This acquisition replenishes CPIF’s development inventory and provides the potential to grow our Sydney portfolio,” he added.
“The completion of the M4/M5 Link Tunnels in 2023 as the last stage of the West Connex project will further enhance the attractive location characteristics of the site and significantly reduce travel times to Port Botany and the Airport”.
CPIF targets $10b
CPIF’s portfolio includes industrial and logistics investments across the country.
Backed by national and offshore superannuation groups, insurance companies and sovereign wealth funds, it has funding capacity to grow to $10 billion.
The trust’s committed development pipeline is worth $780m.
Earlier this month, for the fund, the manager acquired leasehold control of a 35ha Eastern Creek industrial site from Western Sydney Parklands Trust with plans for a $300m business park.
Also this quarter, it purchased a 16.8ha laboratory with significant development upside in Melbourne’s east Boronia.
Six weeks ago it picked up 25 cold store and food distribution centres offered by PFD with a leaseback.
Aldi, Arnott’s, CEVA, Coles, Mainfreight, Marley Spoon, Mazda, Uniqlo and Visy are amongst its other tenant clients.
Last August, the Clean Energy Finance Corporation invested $50m into the trust – a move set to deliver sustainability measures, including from the portfolio’s then-35 million sqm of industrial roof space.
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