Diversified developer Stockland has entered into a joint venture arrangement with Sydney-based fund manage Fife Group worth more than $212 million across logistic assets in Sydney and Brisbane.
Stockland, which made its intentions to remix its portfolio earlier this year has continued to down-weight retail and retirement, and up-weight its industrial assets.
The company is now looking to grow its workplace and logistics portfolio to 25 per cent of its total assets by 2024.
Its latest play will include the development of 71 hectares of prime logistics facilities across the combined land interests of Stockland and the Fife group—subject to rezoning and development approval.
The prime income-generating logistics assets—valued at around $500 million—look set to take advantage of the investment boom generated by the future Western Sydney Aerotropolis.
Stockland has also bought two assets from the Fife group in Brisbane’s prime industrial zone, at Carole Park and Richlands with an end development value of about $140 million.
The properties are located in Brisbane’s logistics “Golden Triangle” , an area bordered by the major arterial routes of Ipswich Motorway, Logan Motorway and Gateway-Pacific Motorway.
“Last week we entered a conditional agreement with the Fife group to purchase two income-producing logistics assets in Brisbane’s prime industrial zone, at Carole Park and Richlands with an end development value of approximately $140 million on a yield of around 6 per cent, including an 18 month rent guarantee on any unlet space.”
The development of the Carole Park facility, which has already commenced by the Fife group, will include the delivery of three buildings totalling more than 59,000 square metres, with one of the buildings already pre-leased.
Logistics development is booming in major urban markets around the world, driven by the growing demand created by e-commerce and the need for retailers and wholesalers to be able to deliver goods to end customers within a few hours.
The Stockland logistics development pipeline currently stands at more than $800 million in end value with the group targeting 6 per cent to 7 per cent yields on these assets.
The diversified developer has successfully completed over $150 million of new developments in these markets over the last 12 months with a further $56 million of projects currently under construction.