Qube confirms Logos’s Moorebank move

The Moorebank Intermodal site.

Qube Holdings has confirmed that it has entered into exclusive due diligence with Logos Property Group for the sale of its Moorebank logistics asset, estimated to be worth about $2bn.

It comes after Logos was named as the party in exclusive due diligence for the asset by The Australian’s DataRoom column, in what is shaping up to be the largest real estate mergers and acquisitions deal of the year.

Logos fended off competition from others in the contest, including Dexus Property Group, Charter Hall and Blackstone.

Logos, which is working with advisory firm Grant Samuel, has $13.8bn of assets under management.

Qube said the transaction was still at the status of a non-binding indicative proposal and remained subject to a number of conditions, including the agreement of the precise details and scope of the monetisation structure, completion of due diligence and documentation.

Working on the sales process for Qube has been investment bank UBS.

Sources had earlier said that Logos put forward a knock out bid for the portfolio.

The company counts the Warburg Pincus-backed ARA Asset Management as a major shareholder, which has $88bn in gross assets under management globally.

However, sources say that Logos may bring in other funding partners for the acquisition.

Other investors are Canadian real estate investor Ivanhoe Cambridge, which has $C64bn ($67bn) of real estate assets globally, and Logos founders, including joint managing director John Marsh.

An acquisition will add to the 1.2 million in square metres of logistics real estate across 13 properties that Logos already controls.

While final details of the transaction are yet to be determined, most have expected Qube to sell between 50 and 75 per cent of the logistics park’s land trust and warehouse trust, with Qube to retain the terminals trust.

The deal will enable Logos to collect the rent from tenants at Moorebank.

While the global health crisis has weighed on landlords, the industrial property sector is seen as one of the most resilient, with online shopping in strong demand and offering some relief to the economic fallout.

The yet-to-be-completed Moorebank intermodal facility, in southwest Sydney, is the largest in the country, with the park covering 243ha.

It is being developed on a precinct comprising land owned by the Commonwealth and adjacent to land owned by Qube.

Woolworths is a key tenant.

Qube is selling the logistics park at a time that it is investing capital into its business.

In April, it raised $500m in equity to lower its debt levels, which are now at about 26 per cent of its earnings.