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Centennial winds up logistics fund on a high achieving near triple digit sales growth on Heathwood Distribution Centre
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Centennial divests 1.45ha industrial and logistics estate at 52 Moreton Street, Heathwood for $19.1m after acquiring asset for $7m in 2016
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Heathwood Distribution Centre is 20km south west of Brisbane & fully leased to Yokohama Australia (7,250 sqm GLA) until July 2027
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2,325sqm expansion completed in 2020 as part of the Yokohama lease renewal
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Transaction signals ‘end of life’ for Centennial’s first logistics fund – PIF (Property Income Fund) established in 2016 with two assets
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Sale delivered 15.8% IRR over the fund’s 8.7-year term
Purchaser: Private investor | Agent: Matt Lane of Dulwich Lane
BRISBANE, QLD: Centennial’s first industrial and logistics fund has ended on a high, with the company achieving $19.1m from the sale of its Heathwood Distribution Centre and almost trebling the $7m amount it paid in 2016.
The impressive sales result achieved this month heralds the closure of Centennial’s Property Income Fund (PIF) fund established in 2016 when industrial and logistics assets were largely overlooked in property investment circles.
Backing Centennial’s long held belief in ‘sheds and logistics’, the PIF delivered an average 15.8 per cent internal rate of return (IRR) to investors over its 8.7-year life.
Heathwood Distribution Centre was purchased by a private investor brokered by Matt Lane of Dulwich Lane.
The site covers 14,580sq m and comprises a single office warehouse spanning 7,250sq m of gross lettable area. It is fully leased to global tyre manufacturing giant, Yokohama until July 2027.
In 2020, Centennial refurbished and expanded the warehouse by 2,235sq m leading to the national property investment manager and developer negotiating a new 7-year lease with Yokohama.
Centennial’s Joint Managing Director Paul Ford, said the exceptional sales result achieved for Heathwood Distribution Centre “demonstrates the company’s broad and in-depth understanding of the mid-space industrial market where it can apply its value-add strategy, that typically targets assets between 1,000 to 15,000sq m and turn overlooked assets into institutional-grade investments.”
“Our focus on identifying mispriced or misunderstood industrial and logistics assets within urban infill and last-mile locations will continue while they continue to deliver the best opportunities to extract value for our investors,” Mr Ford said.
“Under capitalised, mid-space assets are still generally overlooked by institutional investors, given they are viewed as too labour intensive to manage from both leasing and upgrading perspectives.”
Centennial has been active across a number of property sectors since 2023 including divestments of 37 assets with a combined value of ~$735m. Over the same period, it has acquired 18 new assets valued at ~$750m, including 15 industrial sites across the east coast.
Mr Ford credits Centennial’s longevity and ongoing success to its ‘capital ready’ approach allowing it to act quickly and decisively, backed by its philosophy of recycling and regular divestment of assets to optimise value for investors.
“We buy well, receive income, we add value, and we divest well at the most advantageous time in the property market cycle,” Mr Ford said.
“As one of the most active property investment managers and developers in the country, we have delivered an average 21* per cent internal rate of return to investors over the terms of their investments, ranging from 1.1 to 8.7 years. We are confident in replicating this success by maintaining a thorough, pragmatic and well-researched approach to asset acquisitions and divestments well into the future.”
*Weighted average IRR for properties sold.
GALLERY
