- The industrial and logistics assets are located in Brookvale and Prestons.
- Acquired for circa $84M and $79M, respectively.
- The fund now includes seven I&L assets.
A joint venture of Centennial and Brookfield Real Estate Secondaries has acquired two prime industrial and logistics assets in Sydney for its $700 million Enhanced Value Partnership (EVP).
The acquisition comprises two industrial infill sites in Brookvale and a site in the industrial corridor of Prestons.
“The two new assets are a perfect fit for our $700m EVP fund which recently closed oversubscribed,” said Centennial’s executive director and CEO Industrial & Logistics, Paul Ford.
“We’ve been really selective in our site choices in Sydney and are very happy with the Prestons and Brookvale sites given their land rich nature along with flexible improvements that align with our niche strategy, focusing on mid-space, urban infill sites within land constrained or last mile logistics areas,” he added.
The Centennial-managed EVP fund now has seven industrial and logistics assets since its May 2023 launch, worth $293 million.
Brookvale site acquired from Centuria
Conditional contracts have been exchanged on the Brookvale site comprising two adjoining industrial parks spanning 41,870 square metres (sqm), including 29,607 sqm of gross lettable area (GLA), at 114 and 120 Old Pittwater Road.
Acquired for approximately $84 million, Centennial said the asset will be acquired from Centuria Capital Group, subject to completion of conditions precedent. The transaction was brokered by Colliers‘ Gavin Bishop and CBRE‘s Chris O’Brien.
Current tenants of the site include a Woolworths distribution centre, Fujifilm, Padi Asia, and state and federal government departments including the Australian Electoral Commission.
“Another factor in our decision to purchase the site was the Draft Brookvale Structure Plan’s new zoning height limits which may be increased to possibly pave the way for a multi-storey warehouse,” Ford said.
“The asset currently has a 40/60 per cent office to warehouse ratio with the potential of converting less favoured offices into high-tech and warehouse space to better suit market demand.”
Bishop added that the site offers excellent transport linkages, and lends itself to a range of long-term redevelopment possibilities to take advantage of the zoning and limited competing land availability.
Prestons site acquired from Charter Hall
The second acquisition was made for $79 million, comprising 53,260 sqm of land, and 15,030 sqm of GLA.
In a deal brokered by Cushman & Wakefield, the property was purchased from Charter Hall.
Located at 115-121 Jedda Road in Prestons, the asset contains two large format generic refrigerated logistics facilities, occupied by Primo Smallgoods that sub-leases part of its warehouse to supermarket giant, Aldi.
“The Prestons site is extremely well located adjacent to major road and transport infrastructure networks together with the new Western Sydney Airport, 13km from the site and due to open in 2026,” said Centennial head of property funds, David Cupit.
“It is a high income producing asset offering certainty of income from a multi-national tenant, along with the ability to create additional GLA. Given the site’s suitability for future development and reconfiguration, we are confident of adding value to the asset and repurposing it into an institutional-grade investment.”
“Underpinning the asset’s de-risked cash flow is Sydney’s southwestern suburbs having some of the tightest vacancy rates in the country at around 0.1 per cent,” said Cushman & Wakefield’s international director I&L, Tony Iuliano.
“The location is currently experiencing a severe lack of available developable land, with demand for scale in the south west continuing to drive land value and growth,” he added.
