According to a statement issued by Dexus (copied below), tenants in the acquired portfolio includes Bonds, DHL, Fairfax Media and Mercedes Benz.
17 October 2010
DEXUS Wholesale Property Fund acquires industrial portfolio
DEXUS Wholesale Property Fund (DWPF) today announced the acquisition of an industrial portfolio
comprising 13 properties for $231 million plus acquisition costs, with an initial yield of
approximately 9%. The acquisition will diversify DWPF’s portfolio and is expected to increase the
Fund’s income yield.
The properties are located within key industrial markets across Australia, with eight properties in
Sydney, three properties in Melbourne and two properties in Brisbane. Twelve of the properties are
stabilised, income-producing properties and one is a 6.7ha development site in Richlands,
Queensland, a key industrial market.
The acquisition achieves DWPF’s strategic objective to construct a diversified portfolio by acquiring
quality industrial properties at levels below long term fair value, thereby providing an opportunity
to enhance returns.
Graham Pearson, DWPF Fund Manager said: “Our objective is to increase DWPF’s portfolio allocation to industrial property to between 10% and 20%, by constructing a diversified industrial portfolio of properties primarily located near key infrastructure and employment hubs on the Eastern seaboard.
The acquisition meets this aim, increasing DWPF’s allocation to industrial property to 11%, from 4%
prior to the acquisition.
“We are securing both a portfolio of good quality, stabilised industrial properties and a pipeline of
industrial development land at a level that is below our view of long term investment value. By
making the acquisition at a low-point of the valuation cycle and holding the properties for the longterm we are able to enhance returns to investors.”
The acquisition will be initially funded with debt. In addition, DWPF is seeking to raise $300 million
of new equity, with the potential for up to $500 million, from new and existing investors. The offer
is scheduled to commence later this month. The proceeds of the offer will be allocated to the
development pipeline and to enhance the portfolio quality as well as to maintain gearing within the
fund long term target range of 10% to 20%.
Tenants in the acquired portfolio include Bonds, Mercedes-Benz Australia, DHL and Fairfax Media.
The vendor of the properties is Colonial’s Direct Property Investment Fund.
Following the acquisition, the DWPF portfolio allocation will be approximately 11% industrial, 57%
retail and 32% office.