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Centuria launches counter-cyclical wholesale opportunity fund

$50m raised from HNWs, secures seed investment

  • Centuria Select Opportunities Fund targets 15% IRR1, five-year term after 15-month capital deployment
  • Co-investment strategy targeting opportunities across diverse property and real estate finance sectors
  • Seed investment worth $20.6m: under-rented industrial facility in Keysborough Vic.

Australasian real estate fund manager, Centuria Capital Group (ASX: CNI or ‘Centuria’), has raised $50 million of equity from its Australian wholesale investor network to capitalise on non-core divestment opportunities for its unlisted Centuria Select Opportunities Fund (CSOF or Fund).

CSOF will execute a counter-cyclical strategy to access opportunities across diverse property and real estate finance sectors. It aims to deploy its capital across the coming 15-month period and is targeting a 15% Internal Rate of Return (IRR)1 across a five-year term.

The Fund’s seed investment relates to a $20.6 million industrial logistics facility in southeast Melbourne’s industrial heartland of Keysborough where vacancy rates are less than one per cent2.

Jason Huljich, Centuria Joint CEO, commented, “We are looking at high-quality assets that can provide value-add opportunities such as positive rental reversions, as is the case for the Keysborough investment. We are also looking at industries with strong tailwinds that lend themselves to supply-demand imbalances and growth opportunities.

“CSOF is positioned to capitalise on attractive medium term market opportunities for Centuria’s deep network of wholesale unlisted investors. The Fund is also targeting direct and indirect investments that lend themselves to the capabilities of our in-house real estate team, such as leasing, repositioning, refurbishment and development, as well as real estate credit opportunities. Centuria is co-investing alongside our wholesale investors because we believe in this high conviction investment strategy.”

Located at 93-103 Pacific Drive, Keysborough Vic, the modern logistics facility was built in 2017, providing an 8,756 sqm3 warehouse with a low 45% site coverage. The asset benefits from dual access via Perry Road and Pacific Drive, up to 10.9-metre clearance, four on-grade and two recessed docks and a c.1,500 sqm hardstand.

Its short 2.0-year WALE provides a value-add opportunity to generate positive rent reversions in line with market asking prices today. The property also provides access to 1.5 million households within an hour’s drive time4.

Keysborough is positioned 30km southeast of Melbourne’s CBD with proximity to major road arterials including Greens Road and the Eastlink Freeway.

Centuria is an ASX-200 listed real estate manager with a track record exceeding 25 years, and manages a $6.0 billion industrial platform5.

CBRE’s Andrew Bell and Chris O’Brien represented the vendor.

1. Internal Rate of Return (IRR) net of fees. The rate specified is a target only and is not a forecast. This target is the total return outcome of the Fund at the end of the term of the Fund.  The IRR target will be a composite return based upon the returns of the underlying investments. The achievement of this target is subject to best endeavours and is not a guarantee of future performance. An investment in the Fund is subject to risks, as detailed in the Information Memorandum of the Fund.
2. Source: CBRE
3. GLA
4. Source: SA1 data
5. As at 31 December 2023