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Real estate fund manager Irongate Group has stepped up its investment in the industrial market with four new acquisitions in Queensland and NSW that have boosted its assets in the sector to $350 million.
The company, which is backed by South Africa’s Burstone Group, has also pointed to a resurgence in the troubled office market - a sector that the fund manager exited in 2022 following the sale of the $1.7 billion Irongate listed-REIT to Charter Hall (ASX: CHC) which privatised the trust.
The fund comprised 37 industrial and office assets with Irongate noting that the portfolio had achieved returns to investors of close to 300 per cent over the nine-year life of the REIT.
Irongate has grown assets under management 20 per cent year-on-year since the management team, in partnership with Burstone Group, completed the management buyout of the funds management business from Charter Hall in 2023.
Assets under management now stand at close to $750 million, with this equity committed to projects with a forecast end value of more than $3.5 billion.
The latest acquisitions by Irongate comprise an industrial property on South Pine Road at Brendale north of Brisbane, which has a site area of 9.7ha and gross lettable area of 31,738sqm and the Interchange Industrial Estate at Narangba in Queensland, a 10ha site leased to Bunnings, Apex Building Products, Cleanaway, Liquid Specialty Beverages and Avante.
In NSW, it has bought a property on Williamson Road in Ingleburn comprising 4ha and gross lettable area of 18,564sqm and a property on Zeleny Road at Minchinbury, NSW, comprising a 10,190sqm state-of-the-art cold storage facility which is under development.
Along with an earlier acquisition in Smithfield, Irongate says these properties share a “similar thesis” to that developed through Irongate’s active asset management over the past 15 years, namely buying infill industrial real estate in Australia’s tightest markets with strong underlying property fundamentals that can benefit from a hands-on approach to property management.
Irongate CEO, Graeme Katz, says his team plans to continue emulating its previous successes including the further growth of its industrial platform as well as investment in the rebounding office market.
“This acquisition reflects our confidence in the long-term prospects of the industrial market in Australia,” says Irongate CEO Graeme Katz.
“The sector has consistently shown its strength, and we see further potential for growth, particularly for investors who are able to identify undervalued assets in strategic locations.”
Katz says that, likewise, the property manager is seeing a rebound in the office market, particularly the core Sydney CBD.
“We have previously timed our entrance and exit into this market well and see the signs pointing to a new growth phase,” he says.
“We have already commenced our activity in the office market alongside both existing and new institutional investors.”
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