Mair Property Funds spends $27.55 million on commercial real estate investments in Adelaide, Perth

Mair Property Funds (MPF) has spent $27.55 million on commercial assets in Adelaide and Perth – its fourth and fifth major real estate acquisition this year.

With these deals, the 35-year old West Perth-based commercial property trust and managed funds group has assets under management valued at more than $260 million.

It controls them via 14 trusts offered to private investors.

In 2017, the group acquired its first Queensland asset: the Castle Hill Village Shopping Centre in the northern Brisbane suburb of Murrumba Downs cost $14.2 million.

Now, it has invested $7.55 million for its first South Australian property – an office/warehouse in Adelaide’s industrial pocket of Parooka (pictured, top).

MPF’s first South Australian investment

At 1 Williams Circuit, and tenanted to Vulcan Engineering Steels, this property will be held by the MFP Diversified Fund No 2 – Mair Property Funds’ second commercial property trust which currently includes a portfolio of six retail, medical and industrial assets, in Queensland and Western Australia.

MPF managing director David Ellwood said the Parooka asset provides diversity in terms of both industry and geographic location.

“It also offered lower acquisitions costs through the stamp duty exemption in South Australia and is situated along one of Adelaide’s most important freight transport routes,” the executive added.

The latest Western Australian acquisition is also one of its biggest

Also this week MPF announced it spent $20 million on the new Commercial Service Centre in Perth’s north-east.

The retail asset on a 1.31 hectare parcel in the Banksia Grove District Centre was acquired off-market.

At the corner of Joondalup Drive and Joseph Banks Boulevard, it will be held by a newly launched wholesale investment trust: MPF Banksia Grove Property Fund.

Mr Ellwood said the property is set to benefit from a number of growth drivers, amongst them, a growing residential catchment.

“Whilst well-positioned to leverage future growth opportunities in the expanding [Perth] North East region, the asset also offers strong rental prospects through its diverse mix of national tenants including 7-Eleven, Repco, Pet Barn, Mercy Care and Chicken Treat.

“These tenancies collectively offer a weighted average lease expiry of almost 12 years by income, and with the additional traditional shortage of further commercial service and retail space in the surrounding area, we are confident the trust offers strong income security for our investors as well as flexible exit options”.

Mr Ellwood said he expects monthly distributions for the Banksia Grove investment to be 7.5 per cent.

MPF eyes more

“We are noting high levels of interest from investors both in commercial property and…funds as a whole and we want to ensure we are meeting this demand,” Mr Ellwod said, adding that the company intends to acquire more.

“But our priority is on continuing to ensure the assets we acquire offer the high levels of security and quality that Mair Property Funds has become known for”.

One of the two industrial properties in Perth’s Welshpool precinct which Mair Property Funds acquired in June.

In June, elsewhere in Western Australia, the company bought the Wattle Grove Shopping Centre.

It also spent $9.9 million on two industrial assets in another off-market deal (one of these investments is pictured, above).

Two years ago MPF spent $8.1 million on the Broadway Medical Centre in Ellenbrook, not far from its latest Banksia Grove buy.

Mr Ellwood added that the newest Adelaide and Perth assets would help the group “further strengthen” the performance – and diversity – of its portfolio.

“In response to the increasing appetite from investors for products offering strong returns and income, we have put greater emphasis this year on expanding our portfolio to ensure we can continue to offer regular opportunities through our funds, both in the retail and wholesale space”.

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Marc Pallisco

A freelance property analyst and journalist, Marc is a co-founder of realestatesource.com.au.

Marc Pallisco
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