Funds management and development juggernaut Charter Hall has swooped on $560 million worth of industrial properties as it builds its pipeline to service the explosive growth in the ecommerce, data and cold storage sectors.
Defying the pandemic-hit market conditions, it has acquired and settled 17 assets which have lucrative high-quality tenant covenants, with long lease terms ranging up to 16.9 years and located in large industrial precincts with proximity to major infrastructure and metropolitan areas.
Further boosting its $16 billion pipeline, Charter Hall has purchased a number of development sites that come with surplus land for expansion and development. The group has forecast the industrial portfolio will grow beyond $20 billion.
Charter Hall is an ASX-listed $7.75 billion diversified manager that specialises in assets with long leases across the traditional sectors of office, retail and industrial as well as fast-moving consumer foods, pubs, healthcare and childcare.
Charter Hall chief executive David Harrison said the acquisitions build on the group’s strong momentum in acquiring high-quality industrial assets in prime locations across Australia.
“We continue to lead the Australian market in deal volume, and our ability to secure high-quality assets off-market continues to deliver long-term value for the business and superior outcomes for our capital partners and investors,” Mr Harrison said.
Major tenant customers secured with the latest acquisitions include Australia Post, Toll, Border Express, Cleanaway, Zirconia (Iron Mountain) and state government agencies. One large site is the distribution centre in Lytton, Brisbane leased by Kmart.
Charter Hall industrial and logistics chief executive Richard Stacker said with a further $3 billion of investment capacity together with a captive development pipeline, “we would expect our $16 billion industrial portfolio to grow beyond $20 billion over coming years.”
The deals reflect how the country’s commercial property sales moved up a gear in the second quarter, with the industrial sector posting the strongest ever quarterly deal flow, the latest Australia Capital Trends report from Real Capital Analytics (RCA) shows.
Benjamin Martin-Henry, RCA’s head of analytics, Pacific, said quarterly sales of industrial stock outpaced offices and retail properties combined for only the second time since the start of 2020, having never achieved this feat in the previous two decades.
“This record was despite a relatively quiet first quarter for the industrial market. With a hefty deal pipeline of around $2 billion of industrial deals awaiting settlement, 2021 is highly likely to be a record-breaking year for the sector,” Mr Martin-Henry said.
Commercial property sales worth $13.4 billion were closed over the second quarter, up 15 per cent on the same period last year. For the first six months of 2021, volumes reached $21.2 billion, up 11 per cent compared to the same period in 2020.
Together with the Charter Hall deals, Blackstone completed the sale of the Milestone Industrial Portfolio to GIC and ESR for $3.8 billion, while LOGOS, together with partners Australian Super, Ivanhoe Cambridge, TCorp and AXA IM Alts, bought Australia’s largest intermodal logistics facility – Moorebank Logistics Park (MLP) in Sydney – for $1.67 billion from Qube.
Article Source: www.brisbanetimes.com.au
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