10 May 2016
Propertylink, a leading Australian commercial real estate manager, continues to grow its funds management platform with the purchase of eight industrial assets across four states for a combined acquisition price of A$135.3 million.
The portfolio provides for value-add potential and was acquired for the Propertylink Australian Industrial Partnership II (PAIP II) Fund from Charter Hall at a yield of 8.7 per cent. The properties include:
The acquired portfolio of industrial properties features a Weighted Average Lease Expiry (WALE) of 6 years with blue-chip tenants including Toll (Japan Post Group), the Victorian Government, MTU Detroit Diesel / Penske Group, Schenker Australia and Fastline International.
“This is an outstanding opportunity to acquire high quality industrial assets with strong covenants in highly sought after industrial markets across the country,” said Stuart Dawes, Chief Operating Officer and Head of Investment Management.
“We are seeing significant demand from institutional investors both in Australia and offshore for exposure to these type of industrial properties at scale and with value-add potential. This portfolio of assets is an ideal fit for PAIP II and helps to underpin our target of double-digit returns for our investors who are seeking quality yields in a global environment of long-term low interest rates,” Mr Dawes said.
PAIP II’s strategy is to maximise returns for investors by acquiring industrial, warehouse and logistics assets in Australia. Assets are targeted where Propertylink can generate further value for clients through active management, lease renewals, targeted capital expenditure and timely disposals.
PAIP II launched in September 2015 with a cornerstone investment from Townsend Group with a target of A$700 million in assets. Propertylink also manages industrial properties in Australia on behalf of global investors including Grosvenor Group, Goldman Sachs and Moelis Australia Asset Management.
“These assets are very modern and functional with scope to apply our usual active asset management strategies to enhance value. Apart from the impressive improvements, 75 per cent of the tenants in the portfolio are either publically listed companies, multinational companies or Australian Government departments which provides a strong security of cash flow,” said Peter McDonald, Executive Director and Head of Property.
“We are very pleased to be able to execute on another large portfolio transaction and think this deal will lead Australia’s industrial market for 2016. We expect further high profile portfolio transactions in the coming weeks to provide further strength to the market,” Mr McDonald said.
The selling agent was Tony Iuliano at Colliers International.