BIG W LOGISTICS FACILITY TO WHET INVESTOR APPETITE
Written on the 19 August 2015
A PURPOSE-built Big W distribution centre in South Australia is to be offered for sale by the Lend Lease managed Australian Prime Property Fund Industrial, amid continued demand for investment-grade Australian logistics assets.
CBRE has been appointed as the exclusive marketing agent for the landmark property, which is situated in the satellite transport hub of Monarto, 53km south east of the Adelaide CBD.
Expressions of Interest will close on September 17, with the campaign to be managed by CBRE's Chris O'Brien, Matt Haddon, David Reid and Rory Hilton.
The facility, located on a 37.2ha site on Ferries McDonald Road, comprises a 64,459sqm distribution centre, incorporating a two-level office, cool room and centralised warehouse.
Subject to planning approvals, the facility has potential for expansion and development.
O'Brien, CBRE's national director of industrial investments, expects the campaign to generate significant onshore and offshore interest from listed REITs and institutions, wealth funds, syndicators and closed-end funds.
"The property features an exceptional lessee covenant from Woolworths," he says.
"The remaining lease term is in place until July 2021, and with strong prospects for tenant retention and the current strength of the South Australian investment market, this will underpin interest from a wide range of buyer groups.
"Traditionally, there has always been a considerable demand from investors for east coast logistics assets, which are currently hotly contested and scarce in their availability.
"As such, there is now a shift in focus for many investor groups, both offshore and onshore, who have missed opportunities and are now widening their geographic search."
The property is key piece of infrastructure for Woolworths, with the tenant currently supplying 60 Big W stores across four states from this distribution facility, including Western Australia and the Northern Territory.
The current weighted average lease expiry for the Monarto facility is 5.9 years, as at September 1, 2015, with 10 options of five years available.