Centuria secures $500m from US for logistics investment

After highlighting strong tailwinds for logistics properties in its FY23 results last month, Centuria Capital Group (ASX: CNI) has secured a new $500 million institutional investment mandate on behalf of an unnamed, significant US private investment firm.

The Last Mile Logistics Partnership (LMLP) mandate will focus on acquiring assets within supply-constrained infill industrial markets across Australia, and has been seeded with a $76 million three-asset portfolio which was settled on Friday within key urban Melbourne industrial precincts.

The move comes within four months of Australian property investment manager Centennial securing $700 million from Canada’s Brookfield to close a last mile logistics asset fund with four seed assets in Brisbane and Melbourne.

Centuria highlights Colliers research from the last quarter of 2022 that showed Australia’s industrial vacancy rate was less than 1  per cent, making it one of the lowest on a global scale with supply constraints driving ‘exceptional growth’.

“Centuria has significant experience in securing high-quality industrial real estate across Australia, which is increasingly recognised by domestic and offshore institutional capital,” says Centuria’s joint CEO Jason Huljich.

“Centuria’s institutional capital investments now total $2.2 billion across the logistics, healthcare, daily needs retail and office property sectors.

“The new LMLP mandate adds to Centuria’s deep distribution network as we continue to secure further capital sources across the group.”

The group’s $6 billion industrial platform consists of around 160 properties across Australia and New Zealand, which are highly concentrated in infill logistics markets.

Today’s announcement represents the second industrial institutional capital partnership secured by the group in the last 12 months, after Centuria Industrial REIT (ASX:CIP) cemented the Centuria Prime Logistics Partnership (CPLP) with Morgan Stanley Real Estate Investing securing a 50 per cent interest for $180.9 million in December.

Centuria Capital Group reported a stable operating net profit after tax for FY23 at $115.6 million, with more than $329 million of cash and undrawn debt available at the end of the financial year. At the time, Centuria estimated it managed approximately 420 assets and 2,500 tenant customers, with group assets under management of $21 billion, up $400 million on the prior year.

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