M&G Real Estate has acquired two industrial properties in Australia for a combined market value of US$75 million at a yield of 7.2%.

 

The properties have been purchased for M&G Real Estate’s core Asia-Pacific portfolio, which is managed by Erle Spratt and aimed at institutional investors. M&G Real Estate partnered with PropertyLink, a property investment and asset management firm in Australia, to secure and execute this transaction.

 

The first asset – 9-10 John Morphett Place – is a 42,186 sqm office and two warehouse complex in Erskine Park, New South Wales. Leased to Bluestar Global Logistics, it is situated in a prime, strategic industrial location due to its proximity to major transport routes and newly built link roads.

 

65-75 Strezlecki Avenue is a 23,286 sqm transport and warehouse facility located 15 km west of Melbourne’s central business district in an established industrial hub. It is leased to Northline.

 

Spratt says: “We targeted exposure to the Australian industrial segment to add income and duration to our portfolio in a low growth environment. I am pleased we have achieved this with two high quality assets at an attractive entry yield for an average duration of 10 years with annual fixed increases of 3.5%.”

 

The acquisitions follow the agreement in June to purchase 628 Bourke Street, an Australian office asset located in Melbourne’s central business district. The Australian allocation of M&G Real Estate’s core Asia-Pacific portfolio now stands at 36%. In the last 12 months, M&G Real Estate has invested US$479 million in real estate in Japan and Australia.

 

M&G’s core Asia-Pacific strategy holds 26 real estate assets across Australia, Hong Kong, Japan, Singapore and South Korea, with a combined asset value at US$1.8 billion.