ASX Listed Irongate has rapidly deployed capital into the Retail and Industrial sectors with the acquisition of Randle Place in Adelaide along with 2 industrial projects in Brisbane.
Irongate has partnered with Fortius to acquire Rundle Place from Blackstone in a $210m deal. The transaction is reported to have been concluded in the mid-5% cap range.
Rundle Place is a 23,265sqm trophy asset at the heart of Adelaide’s CBD comprising a 4-level retail centre & 7-level, 506-space car park with Adelaide’s only full line Coles Supermarket and Harris Scarfe, with 5 mini-majors, 48 speciality shops and 12 kiosks, including South Australia’s only Apple store. The property has a WALE of 7.6 years and is 98% occupied. The property was offered for sale via McVay Real Estate.
The property is integrated with 80 Grenfell Street, which Blackstone also owned but sold to Centuria in 2018 for $184.6M. Blackstone acquired both assets for $400m in 2015 from Sam Alter.
Irongate’s is the the former Investec realestate platform, led by Graeme Katz. The Groups support for the Rundle Place acquisition comes through the Templewater Australia Property Fund, an Australian and New Zealand unlisted fund focused managed by Irongate.
Irongate also recently acquired an industrial facility to be constructed at 57 – 83 Mudgee Street, Kingston QLD
and another at Lot 24, Dunhill Crescent, Morningside QLD. The group has acquired the assets on a fund through basis with a total consideration of $20.25m.
IAP CEO, Graeme Katz, said, “once completed, the Kingston Property will comprise two brand new, high quality generic warehouse and distribution facilities with 2,270m² leased to Construction Sciences for 10 years with fixed annual escalations of 2.5% and 3,250m² leased to Waco Kwikform for 8 years with fixed annual escalations of 3.0%. The average rent across the two facilities is $149/m².”
“The Morningside Property comprises 1,016m² of space that will be leased to 3M Australia to be used as its Queensland head office and last mile distribution facility. The lease term is 10 years from completion of construction with rents of $352/m² and fixed annual escalations of 3.0%. The property is being acquired on an attractive initial yield with a very strong tenant covenant.”
IAP believes the Brisbane industrial market currently represents relative value, and the acquisitions complement IAP’s recent Brisbane industrial acquisitions in Brendale (completed in January 2021) and Pinkenba (completed in March 2021).