Centuria, ESR trade Perth warehouses
ESR Australia is selling two adjoining Perth warehouses – branded one business park – to Centuria for an opportunity fund launched 15 months ago.
The Canning Vale Industrial Estate covering 7-11 and 25-27 Gauge Circuit is trading for $38.6 million.
It previously exchanged in 2016 for $21.75m.
“The acquisition is the largest industrial transaction by value in Perth since December, 2023, and it’s the only institutional grade asset in Perth to be marketed during the past 24 months,” a spokesperson for the buyer said of the latest off-market deal.
Also today we are reporting Centuria secured the local arm of Chinese truck maker Sinotruk to a Dandenong North, Melbourne, investment.
Centuria deploys $100m
The unlisted Centuria Select Opportunities Fund (CSOF) will hold the Canning Vale business park.
The manager raised c$100m for the trust in late 2023 to fund the acquisition of sites with straightforward value-add upside.
With a deployment window of 15 months, four properties have now been bought.
A c15 per cent internal rate of return is being chased.
The biggest Canning Vale property – just – #25-27 spreads 2.1 hectares with a 9455 square metre improvement, leased to the Australian Electoral Commission (story continues below).
The second warehouse, containing 8560 sqm, on 2.03ha, is rented to AAA Trailers.
Combined, the improvements cover a low 50pc of the block, giving the incoming owner some development upside.
The blended weighted average lease expiry is 2.5 years.
“Centuria is pleased to secure our fifth Canning Vale asset – a market that continues to benefit from a significant supply-demand imbalance and exceptional rental growth,” head of Funds Management, Jesse Curtis, said.
“In fact, Perth has experienced the strongest industrial rental growth of all national markets in 2024, due to extremely limited vacancy,” he added.
“The Gauge Cct acquisition is consistent with CSOF’s high conviction mandate, focused on securing value-add real estate opportunities,” according to the executive.
“Each CSOF acquisition benefits from a low WALE, low site coverage and were secured with below market rental values.
“The upside is that these properties are located in tightly held urban infill markets which provide potential to capture significant positive rental reversions and redevelopment optionality”.
Canning Vale is about 22 kilometres south of the CBD.
Subscribe to our newsletter at the bottom of this page.
