There’s little doubt around the market that New York private equity powerhouse Blackstone will reap a windfall from the sale of its Milestone Logistics Group.
But another group to benefit from the overwhelming interest in Blackstone’s Australian industrial property company that is for sale is Centuria Industrial REIT.
Expectations are that Centuria’s most trusted investment banking advisers will be coming to its door in the hope of gaining a defence advisory role, with the logic being that the strong interest in Milestone will probably also cause groups to cast their eyes over what is a good portfolio of real estate assets in Centuria Industrial REIT.
Centuria Industrial REIT is currently trading with a market value of $1.8bn. It is part of the Centuria stable overseen by seasoned property executives John McBain and Jason Huljich.
Milestone Logistics is expected to sell for a yield of about 4 per cent. Recently, Centuria Industrial REIT has been trading at a value that places a yield of about 5 per cent on its assets.
Parties that miss out on winning the auction to buy Milestone may look to Centuria Industrial REIT as a quality buy, launching a takeover offer in the hope of buying a high-quality portfolio of assets at a price that is more reasonable.
Industrial real estate has been in hot demand after online shopping has boomed amid the global pandemic and interest rates remain low, leaving investors searching for yield opportunities.
Centuria has used investment banks UBS, JPMorgan and Highbury Partnership in the past.
Centuria Industrial REIT is Australia’s largest domestic pure play industrial property investment vehicle, with 59 high-quality, fit-for-purpose industrial assets collectively worth $2.4bn at December. It is expected to come under the spotlight after the sales process for Milestone draws to a close, with final bids due on Friday.
In the final line-up in the Milestone race are Dexus, Logos, which is backed by Singapore’s ARA Asset Management, Axa Investment, Singapore’s Mapletree and the Warburg Pincus-backed ESR.
Working on the sales process for the $3.5bn portfolio of assets are JLL and Eastdil Secured.
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