Australian REIT Dexus has teamed up with Singaporean sovereign wealth fund GIC to create a A$2bn (US$1.46bn) unlisted trust to invest in Australian logistics real estate and take advantage of the heightened demand for distribution warehouses.
Dexus will seed the new Dexus Australian Logistics Trust (DALT)with a $1.4bn portfolio of core properties and a $138m development landbank, according to company announcements.
“We believe the structural and consumption growth in Australia, particularly from favourable demographics and growth in e-commerce, will continue to drive demand for logistics properties,” said Lee Kok Sun, CIO Real Estate at GIC.
GIC has taken a 25% stake in the existing portfolio and has options to acquire an additional 24% interest by June 2020.
The standing portfolio is almost fully let, while most of the properties have exposure to the Sydney and Melbourne markets.
The sovereign wealth fund has also bought a 49% share of the landbank and will fund its share of the planned developments.
The landbank has a gross development value of about $500m and features three sites across Victoria, New South Wales and Queensland.
Dexus said its third-party assets under management will increase to $14.3bn once the new trust is established.
The company will also retain seven industrial properties worth a combined $611m following the transaction.
Dexus invests in Australian office and industrial real estate, and has $27.2bn of AUM.
GIC has more than $136bn (US$100bn) of AUM.