Irongate Adds Cold Storage Deal to $350m Industrial Play

Irongate Group is advancing its first cold storage play as part of a $350-million industrial push across the east coast.

The property fund manager’s move comes as Colliers reports growing investor demand in Australia’s cold storage sector, now valued about $5.5 billion despite accounting for just 2 to 3 per cent of total industrial supply.

As part of its “bullish” strategy, Irongate paid $66.5 million for a refrigerated logistics facility under construction in Sydney’s north-west.

The off-market fund-through deal, brokered by Colliers, was struck with Brisbane-based Barber Property Group and includes a long-term lease to cold chain operator Minus 1.

The 1.01ha warehouse will be developed by Barber and built by Spaceframe Buildings on a 1.99ha site at 1-3 Zeleny Road, Minchinbury.

Irongate will acquire the completed facility under the terms of the fund-through structure.

Blacktown City Council issued a Stage 1 construction certificate in November last year, approving the $29 million plans for earthworks, the building slab and structural framework.

The facility had been in planning since 2021, originally approved for egg-specific storage and processing.

A modification approved in October 2024 broadened the consent to general cold storage and logistics, removing fitout components tied to egg handling.

Minus 1 will lease the Minchinbury facility on a long-term basis as part of a broader expansion strategy.

Minus 1 is working with Barber Property Group to deliver a national pipeline of purpose-built cold-storage assets.

A Colliers campaign in February 2024  marketed the rollout as a $300-million pipeline, with projects planned in Melbourne, Brisbane, Adelaide and Perth, with Minchinbury forming part of it.

▲ Aerial view of the 1.99ha site at 113 Zeleny Road, Minchinbury.

Colliers’ Gavin Bishop and Sean Thomson negotiated the Minchinbury sale.

Bishop said fund-through deals were becoming more attractive as interest rates eased and high-quality logistics assets remained tightly held.

“This provides investors with the opportunity to access core product, which is especially hard to acquire in Sydney,” he said.

He said local and offshore capital were circling and that he expected yields to tighten in the second half of the year.

Thomson said cold storage had become a key target for institutional capital, driven by demand in food logistics, pharmaceuticals and online grocery delivery.

He said the asset class offered long leases and “defensive income with inflation protection”.

The project is Irongate’s first cold-storage investment under its current strategy.

In a March interview with The Urban Developer, chief executive Graeme Katz said the fund was focused on value-add industrial assets in infill locations.

“This is an opportunity to get in well below replacement cost with an existing tenant on a 10-year lease,” Katz said at the time.

Irongate manages more than $5 billion in assets across Australia and South Africa.

The Minchinbury facility adds to its growing infill logistics portfolio, joining acquisitions at Ingleburn, Brendale, Narangba and Macquarie Park.