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Security Capital raises $34m in rising WA market

People & Companies / Latest News

Australia / Melbourne

Dec 19 2018

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Indigenous Business Australia, an organisation focused on economic independence for Aboriginal and Torres Strait Islander peoples, has purchased two service centres in WA for $34 million.

Located on the Forrest Highway at West Pinjarra, about 80km south of Perth, the service centres sold on a combined yield of 6.35 per cent.

Dawkins Occhiuto Director Chris Jones managed the heavily contested Expressions of Interest campaign with Walter Occhiuto and Andrew Dawkins in conjunction with Savills’ Chris Ireland, Graham Postma and Paul Craig. 
                                                                                                                       
Mr Jones said Security Capital Australia, the Perth based property investment and syndication group, had noted the recent uplift in investment sentiment in the state.

``Security Capital took the opportunity to put the properties to market at a time when mining exploration expenditure in WA is rising and investors are looking to take advantage of the positive growth prospects that will follow.

``Mining remains a significant economic driver in WA and so with any increase in  expenditure in the sector we see concomitant across the board growth and that includes the industrial and logistics sectors in particular,’’ Mr Jones said.

According to the WA Government* the Western Australian economy grew by 1.9 per cent in 2017-18, following six years of declining growth, with the mining industry accounting for 30 per cent of gross state product.

Completed in 2017 the identical, brand new, service centres – Midway Northbound and Midway Southbound – were sold with 20 year anchor leases to Caltex, along with a food court and five tenancies each, producing a net passing income of $1,094,700 per annum - $2,189,400 for both – on a WALE of 15.4 years. 

Mr Jones said the circa 60,000 square metre sites also offered surplus land of approximately 25,000 square metres suitable for further development (STCA). 

He said the property offered the most sought after investment attributes including a blue chip tenancy profile, brand new facilities with depreciation benefits, minimal projected capital expenditure, and significant development potential.

``We expected a strong market response and the result reflected that with competition from  local and off-shore buyers at a time when blue chip investments have become increasingly hard to find,’’ Mr Jones said.

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