ASX-listed Centuria Industrial REIT has acquired the Quiksilver facility in North Geelong for $22.8 million.
Fitzroys director Paul Burns brokered the off-market sale on behalf of a private investor.
The 21,772 sqm facility is on a 3.763-hectare site and is used by the iconic surfwear brand as its Asia Pacific distribution centre.
The site comprises two high-clearance industrial warehouse and office buildings connected by a fully enclosed transit area. The southern warehouse, built circa-2010, has a clearance of 12.2 metres.
Late in 2018, the tenant entered a new five-year lease until late 2023, with a five-year option, on a deal that returns $1,876,290 per annum with 3% annual increases.
The decision was made on the back of the property being chosen for the consolidation of the distribution centres of Quicksilver and the newly acquired Billabong business.
Burns said Quiksilver had made a significant commitment to the property and the Surf Coast area, where they have been for many years.
They recently made further upgrades to accommodate business expansion that include additional warehouse racking, office refurbishment and refitting, and increased staff amenities.
The consolidated Quicksilver and Billabong centre will see turnover at the facility go from around 4.5 million units to circa 10 million units once in full operation in the coming months.
The onsite workforce is expected to increase by around 30 full-time positions and approximately 50 part-time.
Quiksilver is part of the Boardriders Inc. company, owned by New York-based Oaktree Capital Management, and which includes major retailers Billabong, Roxy and DC Shoes. The brand was founded in in Torquay 50 years ago.
“Growth in online shopping and demand for more efficient delivery and a bigger range of products across the retail industry has increased requirements for logistics systems and facilities,” Burns said.
“Industrial real estate is now among the most sought-after investment classes, and land values are expected to rise further in the coming years.”
Burns said there is heightened investor demand for strategically located logistics assets with quality fit-outs and strong lease covenants
Located in Australia’s second-fastest growing city, the property is directly opposite Geelong Port, which saw record throughput volumes over 2018/19 that are expected to surge from 12 million tonnes to 32 million tonnes by 2048.
It is also within 15 minutes of Avalon Airport, and less than one hour from both Melbourne Airport and Port of Melbourne.