Trilogy Funds is adding another property to its industrial portfolio, tapping into the strong growth  momentum of Australia’s industrial property sector with the pending acquisition of a warehouse asset in Brendale. 

The Australian fund manager has contracted to acquire the warehouse and showroom property on a  2.7-hectare site in the Brendale industrial precinct by early June 2024 for the Trilogy Industrial  Property Trust (the ‘Trust’), its second industrial property in the greater Brisbane region.  

The proposed acquisition will see the award-winning Trust hold 15 industrial properties across  Queensland, New South Wales, Victoria, South Australia, and the Northern Territory, with a fund size  of over $280 million.  

Trilogy Funds Executive Director Lending and Property Assets Clinton Arentz said the transaction’s yields and rental increases reflected the ongoing strength of the industrial market in Queensland. 

“We are continuing to see strong demand for large industrial properties in the current Southeast  Queensland market, with less than one per cent vacancy for buildings over 3,000 square metres,” Mr  Arentz said.  

“Certainly, industrial property continues to be an attractive investment proposition given long term  structural themes playing out in commercial property markets globally, including ongoing robust  demand and modest supply.  

“The industrial property sector is still experiencing positive post-pandemic impacts, as increased e commerce penetration created additional demand for warehouse space.  

“This includes ongoing annual rental growth, higher capitalisation rates, low vacancy rates and land rich assets that provide potential for solid returns, capital appreciation and expansion projects to add  value across the industrial sector. 

“We look forward to seeing the evolution of the Trust’s property composition in the future as this  structural shift plays out, with our current focus on manufacturing, logistics and distribution centres.”  

Mr Arentz said the continued demand for large industrial properties and strong investment  fundamentals were important drivers for the Trust’s latest acquisition. 

“The prime location of the Brendale property in one of South East Queensland’s premier industrial  business precincts, combined with its size, and strong tenant covenant will make this a valuable addition to the Trust’s portfolio.  

“The property is 100 per cent leased to a single tenant - a market leader with a 70-year track record in  their industry - who has occupied the site for more than 20 years. 

“With a Weighted Average Lease Expiry (WALE) of approximately 5.5 years at settlement, this acquisition will assist the Trust in continuing to provide a reliable income to investors.”