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Centuria secures $62.5m industrial portfolio for new unlisted fund

  • Three high quality assets in core industrial locations within Brisbane and Adelaide
  • 100% occupancy and 9.1 year portfolio WALE1
  • Six year initial fund term with a 6.00% forecast distribution yield2 for the remainder of FY21, growing to 6.25%2,3 for the full FY22 year.
  • Centuria’s AUM now valued at $10.1 billion.

Centuria Capital Group has secured three industrial assets, worth a collective $62.5 million, for the yet to be launched fixed term unlisted property fund, Centuria Industrial Income Fund No.1 (CIIF1).

CIIF1 is expected to launch in February 2021 with a 6.00% forecast distribution yield2, for the remainder of FY21, subject to the assumptions and risks that will be set out in the fund’s PDS. The fund is part of Centuria’s strategy to broaden its vehicle offering across its unlisted platform.

Two of the high quality assets are based in Brisbane and the other in Adelaide – all located within key industrial submarkets with excellent transport connectivity. All assets have 100% occupancy, and the portfolio provides a 9.1 year Weighted Average Lease Expiry (as at 1 March 2021).

Jason Huljich, Centuria Joint CEO, said, “This will be the first pure-play unlisted industrial fund we have launched for some time. It is designed to capitalise on the strong tailwinds from Australia’s resilient industrial sector, which has grown significantly throughout the COVID-affected period.

“This trio of assets provides a range of tenants across the logistics, manufacturing and distribution sectors, which are all located in core industrial markets within close proximity to major transportation infrastructure.

“Both Queensland and South Australia are benefiting from major Government-backed infrastructure projects, such as the Inland Rail, Brisbane’s second airport runway, as well as new roads and motorway upgrades. These major projects further support the growth across the logistics markets in both states.”

In the past 12 months, Centuria has transacted c.$1.2 billion in industrial property across listed and unlisted funds, including the $236 million Arnott’s portfolio in December 2019; the $417 million Telstra Data Centre (Clayton, VIC) in August 2020; a $106 million five asset portfolio throughout August to October 2020; the NZ$179 million (c.AU$167 million) Visy Glass manufacturing facility (Auckland, New Zealand) in October 2020; the $171 million three asset cold storage portfolio in November 2020; and this three-asset portfolio.

Currently, Centuria manages fixed term unlisted funds across the office and healthcare real estate sectors. It recently launched an open-ended unlisted healthcare property fund – Centurial Healthcare Property Fund (CHPF) and has managed the Centuria Diversified Property Fund (CDPF) since 2016.

Additionally, it manages the pure-play listed office fund, Centuria Office REIT (ASX:COF) and the pure-play listed industrial fund, Centuria Industrial REIT (ASX:CIP). The PDS for the Fund is expected to be issued by Centuria Property Funds Limited in the second half of January 2021 and will be available on Centuria’s website.

1. Weighted average lease expiry (by income) as at 1 March 2021
2. Annualised distribution yield for the period 1 March 2021 to 30 June 2021
3. Forecast returns are predictive in nature and are calculated in accordance with a number of underlying assumptions to be set out in the Product Disclosure Statement (PDS). As such, returns may differ materially from results ultimately achieved. Returns are not guaranteed.