ARA Logos Logistics Trust will splash $S404.4 million ($417m) to buy five logistic properties in Brisbane and invest in two funds in a move signalling the nation’s industrial property sector is still running strong.
The five properties, which include a development asset on the corner of Heron Drive and Curlew Street, are located at the Port of Brisbane and are being considered for S$225.9 million ($233m).
The fund investment includes a 49.5 per cent interest in New LAIVS Trust and a 40 per cent interest in Oxford Property Fund, for approximately S$178.5 million ($184m), which have a combined portfolio of five logistics properties in New South Wales and Victoria.
Listed on the Singapore Exchange, ARA LOGOS Logistics Trust (ALOG) is managed by ARA LOGOS Logistics Trust Management Limited, a wholly-owned subsidiary of LOGOS.
Fund manager ARA took a majority stake in Logos Group, which operates as ARA’s global logistics real estate platform, in March this year.
Logos’ other shareholders include Canadian based Ivanhoé Cambridge and LOGOS’ founders.
On its proposed Brisbane acquisitions and fund investment, ARA Logos Logistics Trust CEO Karen Lee said the outlook for Australia’s industrial market remains stable over the long term.
“[It is] underpinned by the fundamental role of logistics in keeping basic day-to-day necessities of Australians in supply, unprecedented infrastructure investment and growth in defensive downstream industries such as e-commerce.”
The latest move follows last weeks movements in the sector, with Singapore’s Mapletree moving on Blackstone’s distribution centre for $114 million in Acacia Ridge, and ESR Australia picking up a site in the same suburb for $90 million.
Brisbane’s industrial supply
Despite the major movements in the sector, Knight Frank expects the level of transactions during 2020 to be lower than what was seen last year, which at $1.95 billion it describes as a “standout year” for the Brisbane industrial market.
“In the year to October 2020, there has been $717 million in turnover which is roughly in line with the levels 2014-2018,” the Knight Frank Brisbane Industrial market October report notes.
The research found that tenant demand for new space will see the construction of Brisbane industrial facilities hit 12-year highs this calendar year, with more than 400,000sq m of industrial space to be delivered to the market.
Knight Frank also found that Covid-19 has slowed general leasing and brokerage activity in Brisbane’s industrial market while institutional demand has remained high.
The report found the majority of Brisbane supply in the industrial market is being added in Brisbane’s southwest (44 per cent) and south (37 per cent) precincts.
It notes key major institutional developers Charter Hall, Dexus, Fife, Stockland, Frasers, Goodman, GPT and Logos as having 315,000sq m in industrial space either delivered in 2020 or currently under construction for the period up to October.
