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Posted on 23 September 2021

Three of the eight properties Centuria announced it purchased today, are in Melbourne.

The biggest, 51-65 Wharf Rd, Port Melbourne, occupied by Mercedes Benz, is setting it back $22m on a 3.7pc yield.

Developed by Salta, this asset previously sold for $7.85m in 2008.

Vinci Carbone’s Joseph Carbone brokered the latest deal with Colliers’ Jack Kelliher representing CIP.

Elsewhere in the city Centuria has acquired:
•    A 4214 sqm distribution centre at 346 Boundary Rd, Derrimut, for which it is paying $11.9m on a 5.5pc yield; and
•    31-35 Hallam Rd South, Hallam – a 4810 sqm warehouse priced at $6.2m reflecting a 5.8pc return.

To fund the new properties, the manager will now undertake a c$300m capital raising.

“We consider the acquisitions to be under-rented as market rents have continued to grow at a rapid rate on the back of accelerated tenant demand, driven by e-commerce and last mile users,” CIP manager Jesse Curtis said.

“The [blended] Weighted Average Lease Expiry of 3.8 years provides the opportunity to leverage CIP’s strong leasing capability to achieve a positive rental reversion capturing outsized rental growth being experienced with infill industrial markets,” he added.

“In addition, a number of the sites have value add potential through leasing, development or reportioning, adding to CIP’s value-add pipeline”.

Following settlement, CIP will hold 75 assets worth a combined $3.5 billion.