ISPT to put $250m of logistics sites on the market
Super fund investor and developer ISPT is seeking to divest three logistics assets in Sydney and Brisbane from its flagship fund in an effort to bolster the portfolio of the loss-making $18 billion vehicle.
ISPT is expecting the three industrial assets – Kookaburra Logistics Estate in south-western Sydney, South Pine Road in Moreton Bay, and Interchange Industrial Estate in northern Brisbane – to fetch about $250 million.
At first glance, the move to sell the three logistics assets – which all sit in ISPT’s flagship fund – may look surprising given ISPT’s core fund had been increasingly shifting its resources into industrial and healthcare and life science assets, and away from the battered office sector.
The super fund investor’s $18 billion core fund – which has a diversified portfolio including investments in major office towers such as Sydney’s George Place and Melbourne’s 405 Bourke Street – chalked up a $264 million net loss for its 2023 financial year, after racking up a $1.49 billion profit the previous year.
This was due to more than half the core fund being weighted to office property, where vacancy has increased. The core fund also has considerable retail exposure, including in the CBDs of Melbourne, Sydney and Brisbane, where assets have underperformed.
But ISPT has put the three industrial assets onto the market as part of a strategy to recycle capital out of smaller value assets and onto larger scale industrial assets to get its core fund back on track.
“The sale process is a part of our core fund portfolio curation strategy which includes selective recycling of capital into further develop-to-core projects within our extensive logistics development pipeline,” ISPT fund management head Mathew Brown said.
Mr Brown said the sale of the three industrial assets would allow the super fund investor to build an industrial portfolio focused on assets based in prime locations with long-term stability. One example of ISPT’s play at larger industrial sites was its acquisition in March of a half stake in Burra Park, a 280-hectare greenfield logistics development site next to the upcoming Western Sydney International Airport’s entrance.
It has already sold two retail assets, including Halls Head Central in Western Australia for $70 million and Eastgate Bondi Junction for about $127 million. Other ISPT retail assets that remain on the market include Melbourne’s GPO and The Strand Melbourne,
JLL and CBRE have been appointed to market the industrial assets.
