Charter Hall’s Prime Industrial Fund to pay $156 million for Coca Cola Amital’s Richland’s manufacturing and distribution hub

THE site of Coca Cola Amatil’s Queensland factory in Brisbane’s west has been bought for $156 million on a sale and leaseback arrangement.

QUALITY ASSET: Charter Hall managed Prime Industrial Fund to acquire Coca Cola Amatil’s Queensland manufacturing and distribution plant for $156 million.

THE Charter Hall managed Prime Industrial Fund (CPIF) will acquire Coca Cola Amatil’s Queensland manufacturing and distribution plant on a sale and leaseback arrangement.

The wholesale fund will pay $156 million for the 24.89ha site, which has 81,008sq of buildings, at 220-260 Orchard Rd, Richlands.

The property is 100 per cent leased to Coca Cola Amatil on a 20-year triple net lease structure with 3 per cent annual rental increases guaranteed by the parent company.

Charter Hall’s chief investment officer Sean McMahon said the acquisition further strengthens the ASX-listed property group’s relationship with Coca Cola Amatil’s business and demonstrates our ability to partner with existing customers across our industrial platform.

“The acquisition provides the (Charter Hall) with exposure to a high quality resilient fixed annual rental income cash flow, generated from a high calibre tenant that leads the consumer beverage market,” he said.

Colliers International’s Roger Miller, Simon Beirne and Tony Iuliano struck the deal which realizsed a 5.19 per cent yield

The property is about 15km south west of the Brisbane CBD and near the Centenary Motorway

and the Ipswich Motorway.

The area is also home to major retailers, corporate transport, and logistic operators including DHL, TOLL, Iron Mountain, Target, Steinhoff and Myer.

The site comprises an existing 50,414sq m warehouse and manufacturing facility with ancillary office. Coca Cola Amatil has started construction of a new 30,594sq m distribution facility which will complement the existing manufacturing facility and will incorporate a state of the art Automated Storage Retrieval System and Automated Case Picker into the fitout.

The site also provides additional land that could accommodate future expansion to support Amatil’s future requirements.

The sale will settle on December 1, delivering proceeds of approximately $156 million

and resulting in a one-off gain to Coca Cola Amital of about $100 million before tax.

The leaseback has two extension options of five years each and Amatil also has a right of first refusal on the sale of the property.

Amatil’s Group chief financial officer Martyn Roberts, said they were “delighted” with the

level of interest in the sale process.

“I would like to thank the project team for their hard work and strong leadership throughout

this process,” he said.

Amital said the one-off gain will be substantially realised as profit after tax due to the utilisation of capital losses.

This will be recognised in Amatil’s results in the second half of 2017, and be treated as a non-trading item.