Logistics sector surges with Mirvac striking fresh alliance
The property developer is cashing in on the big demand for last mile logistics centres.
Property group Mirvac has expanded its ties with superannuation heavyweight Australian Retirement Trust with the launch of the $370m Mirvac Industrial Venture, which will take a stake in a Sydney industrial development.
Both large scale logistics and last mile delivery have taken centre stage in property, as large scale office deals get harder in the face of higher interest rates and uncertainty about values.
The super fund will invest 49 per cent in the venture, with Mirvac to retain the remaining 51 per cent.
The seed asset for MIV will be Switchyard in Auburn in Sydney’s inner west, which is expected to complete later this year. The complex will span about 72,000sq m of high-quality industrial space, and is targeting a 5-Star Green Star rating.
The deal was brokered by commercial property agent CBRE.
The tie-up was flagged by The Australian last month and Mirvac and ART will keep looking for opportunities to grow the venture, including by leveraging Mirvac’s remaining $2bn industrial development pipeline, with negotiations on future assets already underway.
Mirvac had flagged that it would complete this part of the venture in this quarter, with Switchyard to settle in fiscal 2023, and another Sydney project, Aspect North, to be done next financial year.
“The launch of the Mirvac Industrial Venture is an exciting milestone for the group, as we continue to expand our capital partnering initiatives across all sectors. The venture will allow us to build our industrial and logistics exposure, where we continue to see strong fundamentals, redeploy capital into other development opportunities, deliver our current pipeline, and provide additional revenue streams,” Mirvac chief executive Campbell Hanan said.
He flagged the partnership with the Australian Retirement Trust would grow in future.
ART’s head of global real assets, Michael Weaver, said: “Australian Retirement Trust is very pleased to invest again with our existing partner Mirvac as we grow the relationship to over $1b in assets, with the potential for more to come.
“We look forward to seeing these investments come to fruition to contribute to the retirement outcomes for our 2.2 million members across Australia,” he said.
The venture also expands on Mirvac’s and ART’s existing tie up. Last year, Mirvac struck up an agreement with ART to manage ART’s $800m direct property portfolio, with Mirvac also selling down a 49 per cent interest in the Locomotive Workshop in Sydney as part of this.
Mirvac is stepping up its funds management unit and last month unveiled a tie-up with Japanese real estate house Daibiru, which is backing a $630m office project in the Melbourne CBD being undertaken by the local developer.
In that play, Daibiru has formed a strategic relationship with Mirvac, and will invest in a 50 per cent share of its next generation office development in Melbourne, 7 Spencer Street.