Sentinel secures Pinkenba industrial investment

October 9, 2017

Sentinel Property Group has acquired a major industrial investment with development upside (STCA) within the prime Australia TradeCoast precinct at Pinkenba in Brisbane’s east for $48.5 million.

The waterfront bulk storage industrial facility located on a 140,006 sqm site at 69 Tingira Street, Pinkenba, was purchased in a leaseback arrangement with global diversified industrial chemical company Incitec Pivot Pty Ltd (ASX:IPL). IPL will continue to run its fertiliser distribution centre from the site and will lease approximately 11.5ha of the property with 2.5ha on Soutter St available to Sentinel for further development.  The site benefits also from an adjoining wet lease of 15,370 sqm with associated wharf infrastructure.

The Pinkenba property, purchased through Anthony White and Simon Beirne of Colliers International, adds to Sentinel’s pooled Industrial Trust portfolio which includes properties at Mayfield in Newcastle, Oxley in Brisbane and Paget in Mackay.

Sentinel Managing Director Warren Ebert said this was a tremendous opportunity to acquire a major industrial facility in Pinkenba at a strong investment yield above what prime industrial assets are currently trading for, as well as benefitting from development upside.

“This site offers unique ongoing investment potential with core bulk storage and liquid storage assets in low supply throughout Brisbane, particularly when coupled with direct river access,” he said.

“Recent sales of industrial facilities have reflected yields in the range of 5.5 per cent to 7.5 per cent. This property is being purchased at a passing net yield of 8.2 per cent.

“This is also one of very few sites with wharf access in Brisbane that can accommodate Handymax class vessels of up to 188m long and 34m wide and capable of both liquid and bulk cartage.”

Mr Ebert said it was an ideal time for Sentinel to purchase in the Australia TradeCoast precinct as it is a tightly held market due to the lack of available land.

“The proximity to Brisbane Airport, Port of Brisbane and major transport infrastructure continues to drive demand in this precinct,” he said.

“There are also some major infrastructure projects in play with Brisbane Airport Corporation funding over $2.5 billion worth of infrastructure over the next 10 years to keep up with the city’s growing demands.

“The Port of Brisbane is one of Australia’s fastest growing container ports and Queensland’s premier multi-cargo port, handling almost $50 billion in trade annually.”

Anthony White, Director of Industrial at Colliers International, said: “The TradeCoast precinct has been a focus for investor interest, underpinned by rapidly increasing leasing volumes.  We are seeing more sale and leaseback activity, particularly from corporates which we expect will continue.”

Simon Beirne, State Chief Executive Qld, at Colliers International, said: “A 13 hectare freehold site on the Brisbane River with a seabed lease is a very rare offering. Land is becoming harder and harder to find, particularly with good access to major infrastructure.”

Established in 2010, Brisbane-based Sentinel Property Group has a total national portfolio of more than 40 retail, industrial, office, land, tourism infrastructure and agribusiness assets in Queensland, New South Wales, Victoria, Western Australia, the Australian Capital Territory and the Northern Territory with a total value in excess of $1billion.

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