Pipeclay Portfolio Nets $210m+ from Hines

20 April 2022

Industrial specialist investment manager, Pipeclay Lawson has netted $210m from the sale of 4 industrial assets in Sydney and Brisbane.

The 4 assets were put on the market in October 2021 via JLL and sold to global investment manager Hines, reflecting a passing yield of circa 4.1%.

Underpinned by blue-chip industrial tenants including BlueScope Steel and New York-listed L3Harris, the portfolio comprises 60,000sqm of space on a site area of more than 122,000sqm.

The portfolio comprised;

  • 128 Russell St Emu Plains  NSW
  • 68 Anzac St Chullora NSW
  • 13 Ferndell St South Granville NSW
  • 55 Brownlee Street Pinkenba QLD

JLL’s Roger Miller, Gary Hyland and Tony Iuliano managed the portfolio sale process with Michael Callow of CG Property supporting them on the Pinkenba asset.

The properties were acquired for the Hines Asia Property Partners Fund (HAPP), the new flagship fund for the Asia Pacific Region with $400 million of capital from Cadillac Fairview, the real estate investment arm of Ontario Teachers’ Pension Plan, the largest single profession pension plan in Canada. The fund is a multi-sector, open-ended, diversified vehicle targeting top-tier markets in Japan, Australia, South Korea, Singapore and China (including Hong Kong).

Hines is a privately owned global real estate investment firm founded in 1957 with a presence in 240 cities in 27 countries. The Group oversees $160.9 billion in assets under management. 

Simon Shen, senior managing director and fund manager of HAPP at Hines said, “The logistics market is experiencing robust growth globally and Hines is bringing high quality product that caters to the future requirements of the sector and improves today’s logistics operator’s experiences,”

“HAPP will target increasing opportunities similar to this Australia acquisition and build significant exposure to logistics through our portfolio deals in Asia Pacific.”

“These four assets provide us with immediate scale and a solid foundation on which to grow our industrial and logistics platform in Australia,” said Alysia Reilly, head of industrial and logistics, Australia at Hines.

“Our acquisition strategy is location driven so the fact that this portfolio was heavily weighted to Sydney was a key driver. We are actively targeting locations that fit Hines’ last-mile / urban logistics criteria and assets that we can transition into next-generation urban infill distribution centers over time.”

The portfolio sale by Pipeclay Lawson continues an impressive divestment programme which commenced in August 2021 with the sale of two industrial assets to Centennial Industrial and Logistics for $25m.

Pipeclay Lawson chief executive David Libling said “We are divesting these good assets because they have completed the strategic journey we envisaged for them,”

“Pipeclay specialises in adding value by acquiring assets in locations which we think will improve in their utility and/or repositioning the assets by physical works.”

“For those who have invested in all three Trusts involved in this momentous portfolio sale, Pipeclay is delighted to have delivered a 37.1% IRR (Internal Rate of Return) over seven and a half years.”

The Emu Plains asset was acquired by Pipeclay in 2013 for $20.7m. The 4.9ha site contains two industrial buildings providing 19,171sqm of NLA together with spare hardstand land of 26,000sqm capable of further development. The property is leased to Bluescope Steel with a 4 year lease term remaining.

The Chullora asset was acquired by Pipeclay Lawson in 2014 and comprises a site area of 3.57ha with 19,910sqm of floor space. The property was effectively re-leased during the campaign to Lawrence Dry Cleaners and Uniwell.

The South Granville asset comprises a 26,740sqm site with 15,302sqm of industrial facilities leased to Bluescope Distribution with a 3.7 year WALE.

The final asset at Pinkenba was a 10,600sqm site with a 5,597sqm facility.

Transaction Details

AddressPurchase PricePassing YieldSite AreaGLA
128 Russell St Emu Plains  $    58,500,000    49,710    19,171
68 Anzac St Chullora  $    78,000,0004.1%    35,730    19,910
13 Ferndell St South Granville  $    57,000,0003.3%    26,740    15,302
55 Brownlee Street Pinkenba  $    18,000,0004.9%    10,600       5,597

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