National Storage REIT recently announced its arrangements to obtain the freehold interests of two existing Perth assets at Guildford and Rockingham.
The success of arrangements would see the giant storage company acquire two freehold land parcels adjacent to the Rockingham centre in Cort Way. Lot 27 Cort Way has a long term industrial tenant in place, while Lot 28 Cort Way will be used to expand the hardstand storage offering at the Rockingham centre.
As part of the overall transaction, National Storage also negotiated for improved lease terms for the Subiaco centre which will secure the underlying business and long term leasehold interest. The Subiaco centre comprises approximately 1,000 units over 11,000 square metres of net lettable area.
The Guildford centre comprises 550 units over 6,000 square metres of net lettable area, and Rockingham comprising 430 units over 5,000 square metres of net lettable area. Lot 27 measures approximately 3,100 square metres of gross land area, whilst Lot 28 covers approximately 4,000 square metres of gross land area.
Managing Director Andrew Catsoulis said the transaction illustrates a strategic intent and ability to execute the acquisition of freehold interests from leasehold where possible.
“Importantly we have secured additional optionality through acquiring freehold ownership of these two centres and have achieved operational savings by reducing overall lease rental expenses,” he said.
“These centres have been part of the National Storage portfolio since 2006 so it is pleasing to be able to secure the freehold after ten years operating as National Storage centres.
“We continue our strong working relationship with the landlord, having negotiated favourable terms as part of this transaction and securing our presence in central Perth.”
The total consideration for the transaction is $30 million. Investigations undertaken on the vendor, Carmel Pty Ltd and related entities, confirm its ability to transact. Settlement is expected by the end of January 2017.
National Storage continues to actively pursue acquisition opportunities in line with its acquisition and asset management strategy.