Singapore-listed trust to buy Melbourne property

Mr Daniel Cerf, chief executive of Cache Logistics Trust, said the proposed acquisition "marks another step in our portfolio rebalancing strategy where we look to recycle capital from existing assets into higher-performing assets".
Mr Daniel Cerf, chief executive of Cache Logistics Trust, said the proposed acquisition "marks another step in our portfolio rebalancing strategy where we look to recycle capital from existing assets into higher-performing assets". PHOTO: THE BUSINESS TIMES

The manager of Singapore-listed Cache Logistics Trust is proposing to acquire a single-storey warehouse with office space on Melbourne's outskirts.

The move is in line with the trust's strategy to expand its already significant Australian property portfolio.

The trust will buy the property in the suburb of Laverton North, about 18km west of Melbourne's central business district, for A$22.25 million (S$24.27 million) from investment company Challenger Life CDI Nominees.

The freehold property has a gross lettable area of 20,723 sq m. It is being purchased with an existing tenancy. The warehouse is fully leased to craft retail chain Spotlight which has 4.5 years left of a 10-year lease.

Mr Daniel Cerf, chief executive of the trust manager, said the proposed acquisition "marks another step in our portfolio rebalancing strategy where we look to recycle capital from existing assets into higher-performing assets".

Mr Daniel Cerf, chief executive of the trust manager, said the proposed acquisition "marks another step in our portfolio rebalancing strategy where we look to recycle capital from existing assets into higher-performing assets".

The proposed acquisition will be funded by proceeds from the trust's divestment of Cache Changi Districentre 3 in December last year, which reportedly netted the trust $25.5 million.

Mr Cerf noted that the acquisition will expand the trust's footprint in Australia, where it presently owns and manages six other warehouses.

The company also added in a press release yesterday that Melbourne is Australia's largest industrial market, and has the largest port facility in the country, making it attractive for investors.

The state of Victoria also experienced healthy leasing demand for logistics facilities, said the trust manager, as the state has the fastest growing population in Australia and strong economic growth.

The trust is a joint venture between real estate fund management company ARA and logistics company CWT.

Upon completion of the deal, Cache's portfolio will comprise 19 logistics warehouse properties in Singapore, Australia and China, with a total gross floor area of about 7.6 million sq ft and total portfolio value of about $1.2 billion.

A version of this article appeared in the print edition of The Straits Times on February 23, 2017, with the headline 'S'pore-listed trust to buy Melbourne property'. Print Edition | Subscribe