Cromwell sells Direk distribution centre for $63.05m – 19pc over book value

Cromwell Property Trust was seeded with the Rand Distribution Centre and this seven level South Melbourne office, which is now earmarked to be replaced with a mixed use hotel and residential redevelopment.

Cromwell Funds Management, on behalf of the Cromwell Property Trust T12, has sold a seven year old cold storage investment in South Australia’s Direk, to New York based investment bank Moelis.

The Rand Transport Distribution Centre is trading for $63.05 million – or 18.96 per cent over book value.

The vendor acquired 26-34 Caribou Drive, as one of three seed assets in 2013 for $32.75m – an ‘as if complete’ price.

About 27 kilometres north of Adelaide’s CBD, it is rented for 15 more years to Rand Transport, a wholly owned subsidiary of Anchorage Capital Partners.

JLL’s Adrian Rowse and Tony Iuliano marketed the industrial investment for Cromwell.

Then there was one

Hamish Wehl, Cromwell’s head of Retail Funds Management, said the Rand Distribution Centre disposal “was a fantastic result for C12 unitholders” (story continues below).

“Cromwell expects to make a special distribution of the sale proceeds…upon settlement of the property,” the executive added.

As at 30 June 2020, the trust had delivered returns of 13.5pc annualised yield.

In a statement, the vendor said this fund replicates Cromwell’s other unlisted property trusts insofar as having a seven year initial investment period, innovative construction funding structure and long leases.

Cromwell sold one of C12’s other seed assets in 2015 – a seven storey office at 10-16 Dorcas Street, South Melbourne (which in June we reported was the subject of a mixed-use hotel and residential redevelopment proposal).

The other – a seven floor commercial building leased to the Australian Taxation Office in Dandenong and worth about $100m – is intended to be retained, with Cromwell set to put a proposal to unitholders to extend the trust term.

“Details of any such proposal will be sent to all unitholders and would require a…vote to proceed with any extension,” a company statement said.

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Marc Pallisco

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