Brisbane-based funds managers Trilogy Funds have entered into an agreement to acquire a 3,502 sqm commercial development in Cannon Hill’s Southgate Corporate Park for $22.65 million.
The fully leased complex at 38 Southgate Avenue is being offered to the market by Trilogy Funds as an unlisted, single asset property trust.
Trilogy Funds Managing Director Philip Ryan said Trilogy Funds saw great strength in Brisbane’s suburban commercial property market, especially Cannon Hill’s well-regarded Southgate precinct.
“Southgate is ideally located for a variety of businesses, with easy access to the CBD, Brisbane Airport and the Port of Brisbane,” Mr Ryan said.
“Properties within Southgate don’t come to the market often and 38 Southgate Avenue is clearly an outstanding asset in what is arguably Brisbane’s best suburban commercial precinct.
“Orica, Compass Group and GM Holden are current tenants.
“We are now putting together our product disclosure documents and we have already had strong interest from investors looking to buy Units in the trust.
“There has been a lot of competition in Brisbane’s commercial property market, however we have found there are still opportunities to achieve strong returns with high-quality assets. Indeed, this Trust aims to pay investors a forecast monthly net rate equal to 7.25%pa* for the period from settlement (expected early August) until end of June 2018 and the year that follows ending June 2019.”
A subsidiary of Compass Group (CPG), a London Stock Exchange listed company, lease the largest portion of the development with 43 percent of the net lettable area, while a subsidiary of Orica, an ASX listed company, lease 37 percent and GM Holden 20 percent.”
38 Southgate Avenue was completed in 2012 and has been awarded a 5 star rating from NABERS.
Southgate Corporate Park has considerable scope for future growth, with a further 17,500 sqm of development planned on top of the 42,500 sqm already developed.
Mr Ryan said Trilogy Funds’ focus was on closely managing all its assets with a strong preference for properties in South East Queensland and Sydney, close to its two main offices.
“We invest in properties we can touch and feel,” Mr Ryan said.
“That’s how we can be confident in the quality of the assets we invest in. This approach also allows us to closely manage our assets over time.”
The initial offer in Trilogy’s Cannon Hill Property Trust is open until early August, or until fully subscribed.
Trilogy Funds Management Limited ACN 080 383 679 AFSL 261425 (Trilogy Funds) is the responsible entity of the Cannon Hill Office Trust (Trust) (ARSN 618 676 074) and will be the issuer of units in the Trust. The Product Disclosure Statement (PDS) for the Trust is dated 22 May 2017 and will be available at www.trilogyfunds.com.au/office. Applications will only be accepted on the current application form that accompanies the PDS. Investment in the Trust is subject to risk including loss of income and principal invested. Trilogy Funds does not guarantee the performance of the Trust. Trilogy Funds and its associates will receive fees in relation to an investment in the Trust as disclosed in the PDS. As the Trust will invest in commercial property it will carry the market and property risks associated with investing in property. Also, as the Trust will have borrowings, it will also carry the associated financial and leverage risks. Risks can impact returns and it is important that you obtain and read the PDS and understand the risks of investing. Please note that any information provided by Trilogy Funds is general information only and does not take into account your objectives, financial situation or particular needs. You should consider whether this information is appropriate for you and consult your financial or other professional advisor before investing.
* The forecast return is only for the period from settlement date to 30 June 2018 and the further 12 month period ending 30 June 2019 and is net of management fees and costs and inclusive of GST (less RITCs). The basis of forecast calculations and key assumptions will be detailed in the PDS. There is no guarantee the forecast returns may be achieved, or any particular rate of return.