- Dexus said the sale will realise net proceeds of $22.17 million, a 17% premium compared to the book value
- Currently, the warehouse is occupied by B&D Australia, subsidiary of Dulux Group
- Sale funds will be used to repay debt and strengthen the balance sheet
Listed Australian real estate trust Dexus Industria REIT (DXI) has today announced the exchange of contracts to sell 147-153 Canterbury Road in Kilsyth, Victoria.
Dexus said the sale will realise net proceeds of $22.17 million, a 17% premium compared to the book value dated 31 December 2021. The sale represents a passing yield of 3.9%, with the total unlevered return anticipated to be 35%.
The property, built in 1972, features an 11,882 square metre warehouse on the site. It has a relatively high clearance of approximately 10 metres, and 10 roller doors. Eight gantry cranes and various forms of manufacturing equipment are located at the site.
Currently, the warehouse is 100% occupied by B&D Australia, which is a subsidiary of the Dulux Group.
“The sale price is 233% above the $9.5 million acquisition price in May 2019, and demonstrates that our asset selection and active management creates significant value,” said DXI Fund Manager, Alex Abell.
“Sale proceeds will be used to repay debt and strengthen the balance sheet, and over time will be used to fund higher returning opportunities including DXI’s developments in Sydney and Perth, as well as the on-market securities buyback program.”
Alex Abell, DXI Fund Manager
Settlement is expected as soon as late next month.
As of 31 December 2021, the fund’s portfolio is valued at $1.78 billion. The fund has a target gearing band of 30-40% which allows for it to provide flexibility for future growth without compromising the low-risk approach to management.