Charter Hall spends $102m on Adelaide industrial

Also today, we are reporting Dexus acquired a major Moorebank industrial development site.

Charter Hall has purchased two government backed industrial investments for a total of $102 million.

They will be held in separate trusts.

The Gepps Cross warehouse (not pictured) abuts the Gepps X homemaker centre which Charter Hall co-developed in 2009.

The transaction brings to over $900m the value of warehouse product the manager has snapped up this financial year.

The group now holds industrial and logistics assets worth a total of more than $17 billion.

Netley Commercial Park

Charter Hall’s biggest new property – the Netley Commercial Park, abutting Adelaide Airport – is costing $71.3m reflecting a 4.5 per cent yield.

On 13.47 hectares at 300 Richmond Road, and with 42,000 square metres of improvements, it is fully occupied by the state government, housing State Opera of South Australia and the SES, amongst other divisions.

The vendor, MRS Property, paid $30.25m in 2014, holding it in a syndicate which returned 12pc per annum.

It will now be retained by the Charter Hall Prime Industrial Fund (CPIF).

“The…site is one of the largest parcels of industrial zoned land in the vicinity, with scale that is increasingly rare and difficult to secure in this location,” fund manager Richard Mason said.

“It will benefit from the planned redevelopment of the Adelaide East Logistics Hub, with a number of tenant customers expressing interest in relocating to the precinct,” he added.

“This asset aligns well with our strategy, underpinned by a government tenant and high underlying land value providing significant upside potential over the long term,” according to the executive (story continues below).

Charter Hall recently unveiled plans for a 14 level office at 60 King William Street, Adelaide.

Five kilometres west of the CBD, the property has three street frontages and multiple access point, the buyer said.

Gepps Cross

At Gepps Cross, 10km north of town, Charter Hall is paying $30.7m for 27-35 Matthews Rd – an office/warehouse recently purpose built for SA Health.

This asset abuts the Gepps X Home HQ, a homemaker centre which Charter Hall developed in 2009 in partnership with Axiom Properties and Harvey Norman co-founder, Gerry Harvey.

Being purchased at a 4.9pc return, the property will be held in the Direct Industrial Fund No 4 (DIF4).

The tenant is on an initial lease expiring in 2036.

“We are pleased to be expanding DIF4’s spread to prime, modern industrial real estate, with the addition of a high quality, purpose-built asset leased to the SA government, which is a major tenant customer across our Industrial & Logistics and Office portfolios in metropolitan Adelaide,” fund manager Julian Menegazzo said.

“This acquisition is…nearby to other major Charter Hall modern assets leased to Metcash and Schneider,” he added.

Elsewhere in the city – at Munno Para West – the investor in August outlaid $48.8m for a modern Bunnings warehouse.

In the CBD, it is constructing a 14 level A-grade office at 60 King William Street.

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Marc Pallisco

A former property analyst and print journalist, Marc is the publisher of