Fife Capital makes $200m swoop on Buckeridge portfolio as industrial assets sizzle

Industrial property has locked in its status as country’s hottest asset class.

Late building magnate Len Buckeridge.

Industrial property has locked in its status as country’s hottest asset class with funds manager Fife Capital swooping on a major portfolio being sold off by the estate of the late billionaire tycoon Len Buckeridge in a $200 million deal.

The transaction encompasses properties across Australia and also includes offices and a portfolio of apartments. But it mainly shows the steep demand for industrial properties as more companies turn to reworking their supply chains and e-commerce.

The imminent portfolio sale comes as the logistics property venture between listed developer Mirvac and investment house Morgan Stanley kicks off the sale of a portfolio of three assets for about $150 million.

They are being sold as portfolios as premiums for amalgamated assets rise in the industrial sector as more global buyers are willing to set up beachheads or expand their holdings in Australia.

The real push has been mega deals including the Asian logistics company ESR’s acquisition of the Milestone portfolio from private equity group Blackstone for $3.8 billion.

This was followed by Blackstone selling a 90 per cent stake in a Fife-managed industrial portfolio to PGIM Real Estate and Manulife for about $850 million.

This has cascaded through the sector and other transactions are also showing very tight yields including a Best & Less warehouse in Sydney‘s Eastern Creek that traded on a 3.6 per cent yield via JLL.

Charter Hall has also been buying assets at a sharp rates with the $194 million purchase of a Kmart facility in Lytton, Queensland, showing the heat in the market is likely to continue to drive up prices.

Aaron Desange and Chris O’Brien of CBRE brokered the Buckeridge deal but declined to comment as did the parties.

His family still owns the BCG building empire and in April completed the purchase of WA-based Midland Brick. But some properties and assets have been sold off.

In 2019, BGC Contracting was sold to NRW Holdings for $310 million and earlier the BGC Centre in Perth was sold to Redhill Partners and The Aloft Perth was sold to Hiap Hoe and the Westin to YTL Hotels.

The latest BGC property portfolio was pitched as giving buyers scale across industrial and logistics, office and residential assets.

The holdings spanned 39 assets nationally, with a 46 per cent, 34 per cent and 20 per cent weighting across industrial and logistics, office and residential respectively.

Fife Capital could look to redevelop and reposition some sites. There is also a good exposure to the fast-recovering Perth market where major infrastructure projects and the resources sector are driving spending.

The portfolio spun off an income of about $11.6 million and was mainly sites leased back to BCG, with the WA focused builder turning over more than $1 billion annually.

Meanwhile, the Mirvac Industrial Logistics Partnership confirmed it had kicked off an expressions of interest campaign via CBRE and JLL for the sale of three assets within its portfolio: 26-38 Harcourt Road and 47-67 Westgate Drive, both in Altona, Melbourne, and 1 Johnson Rd, Campbelltown in Sydney.