ESR Buys 79ha Site in South East Melbourne

Hong Kong-listed logistics platform ESR has honed its focus on Australian industrial property, securing a 79-hectare site in Melbourne’s outer south-east.

The property, located between 590 and 620 Western Port Highway in Cranbourne West, was sold by long-time owners, and vegetable growers, the Kelly family.

The Cranbourne West site, to be known as the Tullamore Business Park, was marketed by Cameron managing director Ben Cooper and pitched as one of the last remaining large-scale development parcels in the growth corridor.

Major retailers and online groups such as Aldi, Amazon, Bunnings, Grays Online and Woolworths already hold established distribution centres in and around the precinct.

Financial details, including the acquisition price, were not disclosed due to a confidentiality agreement between the vendor and ESR.

ESR will now press forward with plans for a premium-grade logistics hub, with an expected end value of $450 million.

ESR Australia chief executive Phil Pearce said the Melbourne acquisition would add to its existing land banks in New South Wales and Queensland.

“Our recent fund raisings mean we’ve got significant capital so we’re able to move decisively when opportunities such as these come up.

“This is a result of the continuing appetite from our investors for high quality logistics assets, and our proven track record to deliver,” Pearce said.

The industrial site will be held within the group’s new $1 billion Australian develop-to-hold logistics fund.

ESR said it had a number of sites under due diligence which could be purchased by the ESR Australia Development Partnership.

The fund is backed by a $400 million commitment from cornerstone investor GIC, the sovereign wealth fund established by the government of Singapore.

ESR is also eyeing new opportunities in the Asian industrial sector after announcing a US$1 billion fund alongside joint venture partners APG and Canada Pension Plan Investment Board.

ESR has more than $2.5 billion of assets under management in Australia and $37 billion globally, including in China, Japan, Singapore, South Korea and India.