Australian developer Logos Property Pty Ltd has bought its second Auckland industrial site, this time with a new unnamed global institutional investor as its partner.
An unconfirmed report from IPE in London suggests Logos’s partner for the Otahuhu purchase is GIC Pte Ltd, the Singaporean Government’s sovereign wealth fund. Logos wouldn’t comment on the partner or the Otahuhu price tag.
GIC previously partnered the Goodman Property Trust in the ownership of a portfolio of properties along Fanshawe St, overlooking the Lighter Basin on Auckland’s waterfront. That partnership ended when they sold the portfolio to funds managed by US asset manager Blackstone Group LP for $635 million.
Last July, Logos formed a partnership with Australia’s biggest superannuation fund, AustralianSuper Pty Ltd, to develop the Wiri Logistics Estate it had bought from Fletcher Building Ltd a year earlier.
Last Wednesday, Logos announced its second venture, buying freight & logistics company Toll Group (NZ) Ltd’s 17.2ha at 259 James Fletcher Drive, Otahuhu. Logos & Toll have scheduled settlement for late 2020.
In the industrial heartland
The site is in Auckland’s industrial heartland – within 4km of State Highways 1 & 20 and adjacent to the eastern & southern main rail lines. A dedicated rail line has been built to connect Toll’s facility with the southern trunk line through a north/south junction 400m to the east. Auckland International Airport is about 8km to the south-west and the port of Auckland 17km north. Port of Tauranga’s MetroPort in Onehunga is 7-9km away (depending on route) & Ports of Auckland’s Inland Port in Wiri is 14.7km away by motorway.
Toll had bought this site in 2017, also from Fletcher Building, for $59.5 million. It was previously occupied by Pacific Steel Ltd, which Fletcher sold to BlueScope Steel Ltd of Australia in 2014.
Toll will lease back 7.6ha containing its new rail serviced freight forwarding facility, and Logos will redevelop the remaining 9.6ha into a logistics & intermodal estate on a speculative basis.
The Toll development
Toll’s Otahuhu development comprises a 24,800m² freight cross-dock facility, a 6000m² parcel facility, 3530m² of offices, 22,730m² of heavy-duty yard space & 441 parking spaces for on-site staff & drivers.
Toll NZ executive general manager Jon Adams said last year this new freight terminal was “a highly strategic site with linkages to all major arterial routes. Toll will be in a position to berth trains at dock level, inside the terminal. Road & rail will be served under cover and the new facility will increase safety & productivity across the board. This significant investment reflects Toll’s immense commitment to our customers and the importance of Toll NZ to the Asia Pacific region.”
Full site to take 66,000m² of facilities
On completion, Logos said, “the Logos Otahuhu Logistics Estate will have an estimated value of about $NZ250 million across about 66,000m² of logistic facilities”.
The group’s $A1.7 billion ($NZ1.77 billion) development pipeline comprises 46 assets & developments across New South Wales, Victoria, Western Australia, Queensland & Auckland, including 7 completed projects for Toll Group.
Logos’s head of Australia & New Zealand, Darren Searle, said the company was committed to strengthening Auckland’s logistics & distribution offering through the development of modern, quality logistics & intermodal facilities.
Logos bought the property through a marketing campaign by CBRE, headed locally by Bruce Catley, managing director of CBRE’s South Auckland office, and in Melbourne by Chris O’Brien, executive director of its industrial & logistics, capital markets division.
Toll facility “the gold standard”
CBRE said major tenant Toll Networks (NZ) Ltd’s rent had been set at $6.4 million/year with fixed rental growth of 2.5% & a 15-year lease with 2 10-year rights of renewal.
CBRE’s national director of industrial & logistics, Claus Brewer, said hi-tech intermodal freight management such as Toll’s facility was the gold standard in logistics: “It enables smooth & efficient cross-track handling of freight between different transport modes. Separate roadways for trucks & other vehicles will provide a complete drive-around capability & free-flowing movement of different vehicles inside & outside the building. New accessways are being built [now built] for both James Fletcher Drive & Savill Drive.”
Mr Brewer said in the sale campaign last December that the site offered many opportunities to add value: “Toll’s initial investigations have determined that there is potential to reduce the size & configuration of the existing 14,415m² stormwater pond on proposed lot 5 to provide opportunities for future construction.
“Toll has prepared a draft subdivision plan, undertaken geotechnical work & masterplanned the site infrastructure in contemplation of the future subdivision. The balance of the developable land equates to 74,832m² and offers a significant opportunity for future development & further value-add.”
Mingtiandi, 9 April 2020: GIC said backing Logos’ $NZ250m New Zealand warehouse JV
IPE, 9 April 2020: Logos & GIC acquire NZ logistics development site
Earlier & related stories:
15 April 2020: Backgrounder: International industrial property expansion – Logos, ARA, Goodman links, Ivanhoé Cambridge, Plenary Americas, CBRE Global Investors, Toll & Japan Post
10 July 2019: AustralianSuper joins Logos to develop Wiri Logistics Estate
12 April 2019: Logos starts work on Wiri logistics estate
10 December 2018: VXV Fanshawe St sale unconditional
11 July 2018: Logistics specialist Logos buys Wiri site
18 May 2018: Goodman & Singapore fund sell VXV portfolio to Blackstone
7 November 2014: GIC buys into Goodman waterfront partnership
Attribution: Logos, Toll, CBRE, IPE, Mingtiandi.