Prestons industrial facility sells for circa $70 million

Sydney, 29 October 2014 – The much anticipated sale of 38-46 Bernera Road, Prestons has been finalised on behalf of the developer & builder, Vaughan Constructions, for approximately $70 million.

The asset was offered for sale via a private placement program with CBRE’s Matt Haddon, Chris O’Brien and Angus Klem, acting on Vaughans’ behalf.

Established in 1955, Vaughan Constructions has built an enviable reputation for being the design and construction professionals specialising in industrial and commercial facilities constructing industrial, warehouses, logistics centres, bulky goods retail outlets, suburban offices and cold-storage facilities. This sale result again confirms the quality of the investment product that Vaughan delivers, which is always well received and highly sought after by the market.

Vaughan is expanding with their national based clients and is currently building projects for the logistics and transport industry in Melbourne, Sydney, Darwin and Adelaide.

Vaughan Constructions is one of Australia’s top 400 private companies with an annual turnover of over $220 million, boasting some of Australia’s top ASX listed and private companies as clients including Coles, Woolworths, ALDI, Linfox, Pacific Brands, Coca Cola, Kraft and Toyota.

The Prestons estate consists of a state-of-the-art Refrigerated Logistics facility which is currently under construction and due for completion in April 2015, in addition to a recently completed, ambient temperature warehouse, office & distribution facility. It is located in the tightly held suburb of Prestons – a highly regarded industrial hub in South Western Sydney, benefiting from its proximity and access to the interchange between the Westlink M7 and M5 Motorways.

The buildings have a combined net lettable area of 22,100sqm and are situated on a 5.047 hectare land parcel. They are securely leased to two market-leading, high profile tenants; the Refrigerated Logistics facility has been pre-committed by Ingham Enterprises Pty Limited on a 15 year lease commencing upon completion, and Salmat Mediaforce Pty Limited commenced a ten year lease on the smaller facility in June, earlier this year. The property benefits from a long W.A.L.E. of circa 14 years and generates a combined net income of $4,631,687 per annum.

Matt Haddon said; “This was a rare, premium grade industrial investment opportunity; the first of its kind offered to the market in 2014. This acquisition reinforces the rapidly emerging trend of institutional investors seeking exposure to the Refrigerated Logistics market. Australia’s reputation as the “protein fountain” of Asia Pacific has seen yields tighten significantly in this market, as investors become more comfortable with the long term occupancy security that the local food sector now provides. The property provides a genuine, state of the art investment in one of Australia’s premium industrial precincts, strategically positioned within a prime industrial growth corridor and neighbour to many of Australia’s most well regarded occupiers in Aldi, Mainfreight, Bunning’s, Woolworths, HPM LeGrand, Atlas, Scott’s Refrigerated Transport and Volgren.”

Chris O’Brien said; “Historically Prestons has witnessed a slightly slower rate of development as opposed to neighbouring logistics hubs such as Moorebank and Eastern Creek, primarily due to the fractured ownership of land largely been held by private families. However, over the past five to ten years major investment houses with an industrial specific focus, such as Goodman, Mirvac and Aviva, have taken key stakes in the precinct as sites become further amalgamated.”

Angus Klem said; “In addition, the suburb will benefit the Government’s planned Intermodal Terminal Project at nearby Moorebank, involving the development of freight terminal facilities linked to Port Botany by rail, increasing Sydney’s rail freight capacity and reducing road freight on Sydney’s road network.”