ESR spends $52.5m for Melbourne warehouse
Centuria has ended well in the black selling a major Melbourne industrial investment bought nine years ago by Primewest, which it acquired in 2021.
Following an off-market deal, the asset manager is banking $52.5 million for 18 Foxley Court, Derrimut.
The buyer is the ESR Real Estate Investment Trust (ESR-REIT).
The deal comes three weeks since realestatesource.com.au reported the Singapore-listed giant bought five Melbourne industrial investments from Frasers Property Industrial – outlaying a total $277m.
In a statement the buyer said the six assets are expected to deliver unitholders a c5.1 per cent distribution.
Centuria quits in the black
Primewest paid $24 million for 18 Foxley Ct in 2017; it had yet to be built.
That seller, Frasers, offered it with a three-year rent guarantee before securing CEVA Logistics for that term.
In late 2020 – as the country recovered from a national lockdown – Primewest secured the government’s HealthShare Victoria as tenant (continues below).
That rental agreement, due to expire this year, was instead extended until 2031 (the asset’s weighted average lease expiry upon ESR-REIT buying it is 4.8 years).
On 3.5 hectares the asset contains 23,208 square metres.
The deal will be funded with proceeds and finance; the trust recently sold eight warehouses and a hotel, all in Singapore.
“Following the completion of the deal, Singapore will continue to account for more than three quarters of the REIT’s enlarged portfolio by rental income;” a spokesperson said in a statement.
“Australia’s contribution will increase to 16.1pc from 12.7pc,” it added.
Derrimut is about 18 kilometres from the CBD.
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