Growthpoint Properties Australia has decided against redeveloping a 25 hectare Broadmeadows distribution centre vacated in February by Woolworths – instead selling it to a joint venture partnership which will.
LOGOS Group and Ivanhoe Cambridge are paying $50.2 million for 120 Northcorp Boulevard, in a deal scheduled to settle in 10 days.
The incoming owners have earmarked the holding, 17 kilometres north of Melbourne, for a $230m business park.
Branded LOGOS Broadmeadows Logistics Estate, it will comprise 120,000 sqm of warehousing available for food and cold storage, ecommerce and distribution.
LOGOS will be the developer and manager.
Pandemic made us review options, including divestment: Growthpoint
The vendor will use sale proceeds to repay debt.
“Prior to the outbreak of the COVID-19 virus, [we] had been progressing development plans for this asset,” a company statement said.
“However, as part of its response to the pandemic, Growthpoint delayed all non-essential capital projects and decided to review its options for this site, including divestment”.
Managing director Timothy Collyer added “after reviewing our options…we decided to sell this asset as undertaking a lengthy development project was outside of our risk and return appetite in the current operating environment”.
The new LOGOS Broadmeadows Logistics Estate
The Broadmeadows property is a risk and return match, however, for LOGOS – which just last week, with MaxCap, acquired a c$70m distribution centre under construction in Epping, adding it had been looking for opportunities in the city’s north “for years”.
That asset, branded LOGOS Epping Logistics Estate, is 10 kms east of 120 Northcorp Blvd.
Ivanhoe Cambridge’s senior vice president, Asia Pacific, George Agethen, said its investment “continues our strategy for logistics in the APAC region and our partnership with LOGOS” (story continues below).
“We remain focused on assembling a sizeable portfolio in Sydney and Melbourne, which have shown remarkable resilience through the COVID-19 pandemic,” the executive added.
“We are confident that we will deliver an environmentally leading estate that will meet the demands of our users for the long-term.”
Broadmeadows property to get makeover for 21st
The Broadmeadows property was purpose built for Woolworths in 1999.
It contains 60,044 sqm of area within several interconnecting warehouses, accessed by 21 B-double finger docks and 40 recessed loading ones.
A two level office also forms part of the design as does 344 car parks.
There are several undeveloped tracts including a high-profile corner abutting the train line between Gowrie and Upfield stations.
In 2017, Growthpoint banked $90.75m selling a Woolworths-leased distribution centre and Victorian head office, in Mulgrave, to local private investor Harry Stamoulis.
Our customers have been looking north with us: LOGOS
LOGOS’ head of Australia and New Zealand, Darren Searle, said the Broadmeadows acquisition is strategic “as a number of our existing customers have been looking to expand into the north of Melbourne, an area which has long experienced limited supply of prime grade logistics assets, for some time.”
The Northcorp Blvd estate, construction of which is expected to begin next year, is already seeking tenants, the landlord penning configurations between 15,000-50,000 sqm.
“We look forward to bringing our global design and development expertise to develop this state-of-the-art property,” the executive added.
LOGOS Asia Pacific’s portfolio, some 100 logistics assets in nine countries, is estimated to be worth about $13.8 billion.
ARA Asset Management, like Ivanhoe Cambridge, is a major shareholder.