SALE SHOWS LONG-TERM STRATEGIC THINKING
Surviving through COVID-19 and then flourishing on the other side was the thinking behind the purchase of this meat processing facility
GOLD Coast-based property fund manager OzProp Capital has emerged as the new owner of a meat processing facility in Ormeau after spending $12.2 million.
The 18 Motorway Circuit property last sold for $11.05m in 2015 to Robert and Catherine Carr.
The tenant, Top Cut Foods, has one-and-a-half years remaining on its lease, however marketing agent Jaems Balfour, of Ray White Industrial Milton, said this did not discourage OzProp.
“Due to COVID, food and medical properties and anybody that has hit their straps in their market is proving their strength in the industrial sector,” he said.
“OzProp is confident Top Cuts will extend or take up their option which is five years.” The contract for the 7980sq m property, which hosts a 4598sq m cold storage and food processing facility, was signed in December last year and settled in April.
Mr Balfour said it was an offmarket transaction where there were two competing offers, both from syndicated funds.
He said this proved the strength of the asset as well as the fact the deal was finalised during COVID-19.
The sale, based on net income of $973,000 from the tenant to the owner, reflects a yield of 7.9 per cent.
“For the funds and privates it all comes down to tenure,” Mr Balfour said.
“If we can get a nice long WALE the yield would be sharper.”
OzProp has been expanding its portfolio of cold storage and food production facilities and properties on the Gold Coast in recent years.
In 2017 it bought a Gold Coast cold storage warehouse from Rich Listers Tony and Christina Quinn for $22m.
Top Cut Foods has occupied the Motorway Circuit premises since 2015. The facility was built in 2009 for a seafood export business.
The company was established in 1981 and has brands including Tender Plus, Gippsland Fresh, High Country Pork and Northern Rivers.