New venture sees big industrial property buy-up
A half a billion dollar industrial property investment joint venture between New Zealand property company Stride Property Group and international investors has kicked off.
Called Industre Property Joint Venture, it started business on Wednesday with 13 industrial properties in Auckland and Hamilton, including two properties under development.
Stride chief executive Philip Littlewood said Industre could ‘‘quite comfortably’’ reach more than $500 million in value. Its portfolio was now worth $398m, it had $32m of committed development and it had another $154m funding available.
Stride announced the specialist industrial property joint venture nine months ago. Overseas Investment Office approval was granted for the joint venture this year.
‘‘This is early days for us. We have strong aspirations to grow,’’ Littlewood said. Industre will be managed by Stride Investment Management.
It comprises Stride and a group of international institutional investors led by JP Morgan Asset Management (JPMAM).
Industre would not be the biggest industrial property owner in New Zealand, but it could grow to be the biggest private industrial property owner, Littlewood said. Bigger industrial property owners were listed companies PFI and Goodman Property Trust.
JPMAM would fund further portfolio growth until the shareholdings in Industre were 75 per cent JPMAM and 25 per cent Stride over the longer term.
The Industre portfolio was valued at $398m at commencement, with Stride owning 68.5 per cent. It included a property in Wickham St, Hamilton, bought for $10m in April plus estimated capital expenditure incurred before the July 1 start date.
Part of the Hamilton property was being developed as a resource recovery park for Waste Management, which would take a 25-year lease on completion of the development. Stride said that property should be worth $28m on completion.
As well, Industre had agreed to acquire a property at 1 Ross Reid Place, East Ta¯ maki, for $15.5m, due to settle on July 23.
The property is leased to Facteon Intelligent Technology, a Haier Group company. The property includes 2977 square metres of vacant surplus land. After this acquisition, Stride will hold 65.8 per cent of Industre.
The Waste Management Auckland headquarters in East Ta¯ maki developed by Stride would also be added to Industre, Littlewood said. That is valued at $98m.
The establishment of Industre is part of Stride’s strategy to invest in and manage properties in specific commercial property sectors.
It manages listed company Investore, which owns largeformat retail stores. Stride has an 18.8 per cent stake in Investore. It also manages the Diversified NZ Property Trust, which owns four shopping centres. Stride has a 2 per cent stake in the trust.
Stride has also signalled it is looking to grow its office buildings ownership with a view to establishing an ‘‘office investment fund’’ like Industre is for industrial properties.