GPT cranks up industrial property effort
GPT has stepped up its investment drive into the industrial property sector with a series of portfolio deals in Sydney, worth a combined $212 million, while launching fresh industrial development in Queensland and Victoria.
Led by Bob Johnston, the listed fund manager has been been pursuing a strategy of increasing its portfolio weighting in industrial property assets while its exposure to retail property is effectively reduced.
Underscoring the effort, GPT has added to its recent $105 million acquisition of a three-asset portfolio – Kingsgrove, Villawood and Blacktown – from AMP Capital, with a $107 million deal with a private investor for two properties at Erskine Park.
In all, the five Sydney logistics properties comprise 88,200 square metres of lettable area, with an overall average lease expiry of 8.6 years and initial yield of 5.4 per cent.
GPT’s head of office and logistics, Matthew Faddy, said all of the facilities were fully leased and in highly sought after areas.
“Sydney continues to see very strong tenant demand for premium logistics facilities and we continue to look for both development and acquisition opportunities to grow our portfolio in well-located areas.”
The Erskine Park facilities include a 25,400-square-metre and a 12,300-square-metre warehouse, both built in 2009, and which are next to GPT’s 24-hectare Connect@Erskine Park logistics precinct.
Meanwhile, GPT is also increasing the tempo further north, striking a pre-commitment from a tenant to a new 20,500-square-metre logistics development at its Wembley Business Park at Berrinba, in south-east Queensland.
The end value of the Berrinba facility is expected to come in around $48 million. It is the first asset to kick off development at the business park, which could potentially become home to as much as 74,000 square metres of industrial real estate, worth about $150 million.
In Melbourne’s industrial west, GPT has also kicked off development of a $36 million, 26,000-square-metre logistics facility at a 15-hectare site in Truganina that it acquired in February this year, adjoining an eight-hectare site bought last year.
The combined Truganina site is expected to deliver 140,000 square metres of logistics space with an end value of about $200 million.
At GPT’s annual shareholder meeting earlier this month Mr Johnston said the fund manager would grow its investment in logistics assets to $3 billion, but not at the expense of retail.
“We will continue to have a strong position in retail but we will grow the other parts of the business faster. It’s more around that rather than necessarily that we are about to exit from retail.”
Mr Johnston defended the quality of GPT’s retail assets as “best in class”, pointing to 13 that were in strong demographic areas, including Melbourne Central, which is the most productive shopping centre asset in Australia.
