$3b property group Centennial in capital partner search; hires CBRE
Centennial Property Group, a real estate investment manager with $3.3 billion under management, is ready to hit the accelerator on its ambitious growth plans, seeking a strategic partner to make a capital injection in the business.
Street Talk can reveal the group, which specialises in industrial and logistics, commercial and retail property, has tapped CBRE’s capital advisory team to find a long-term partner to come into the head management company.
The partner could also attract capital to Centennial’s 34 managed investment funds or seed a core or core-plus investment vehicle focused on the metro industrial and logistics sector. Centennial has over $400 million worth of warehoused assets to kickstart a new fund.
An opportunity to acquire between 10 per cent and 49 per cent of the platform is on the table, paving the way for Centennial’s management, staff and family office investors to make a partial exit. It is still early days, but Centennial could fetch a total enterprise value between $100 million and $200 million, sources said.
CBRE’s team, led by managing directors Stuart McCann and Paul Ryan, hit the pavement in August, reaching out to large strategic investors, insurance companies, asset managers, pension funds and private equity. The aim is to find a party that can commit to a five-year-plus investment and aligns with Centennial’s strategic vision.
Centennial was founded almost 15 years ago by finance and property specialists Jonathan Wolf and Lyle Hammerschlag. It started life churning private real estate into institutional-quality real estate, investing on a single asset basis, but has since evolved by adding managed funds to the mix, raising $1.3 billion in equity from private wealth investors and $860 million in institutional capital from investors like KKR and Brookfield.
Brookfield has backed one of Centennial’s logistics funds, and KKR’s real estate arm helped it acquire a large-scale logistics facility in western Sydney’s St Marys in 2022.
The company, which has a staff of 48 across Sydney, Melbourne and Brisbane, is led by joint managing directors and former Charter Hall operatives Adrian Taylor and Paul Ford. Taylor, chief executive of Charter Hall’s office platform, joined the business four years ago, while Ford came on board seven years ago as part of an industrial platform joint venture.
All up, it’s inked 185 acquisitions and divestments, conducted more than 100 capital raisings and sold $1.7 billion in assets.
Among its key investments is a $4.5 million upgrade of warehouse space in Acacia Ridge, Queensland, into warehouses and offices, delivering an 18.2 per cent return to investors, and the development of The Link Industrial Park, also in Queensland, into new industrial space.
Centennial’s aim is to reach $5 billion in assets under management over the next three years. It sees growth in the retail (malls and large format), big box industrial and logistics outside the city centres and listed REIT sectors.
CBRE is running a formal process, running an expression of interest campaign and asking for submissions by October. It will shortlist a handful of parties and undertake reverse due diligence.
