The property opportunity you can access that ticks all the boxes

In recent weeks, Livewire has been speaking with Trilogy Funds’ Laurence Parisi about why he and the Trilogy team like industrial property and how they go about putting deals together. To this point, those conversations have been largely theoretical. That changes now.

As we approach the end of a very active year for Trilogy, the manager has identified another property that meets its exacting standards, and, more importantly, you can invest in it. Livewire sat down again with Parisi to discuss an exciting new opportunity they are pursuing. 

Key details:

• The property is located at 75-95 & 105 Corio Quay Road, North Geelong, Victoria
• It is situated in a tightly held industrial precinct, where opportunities to invest are uncommon
• The site includes two warehouses which are both very solid. Both warehouses are tilt-panel for the full wall, which is rarer and better quality than the more common metal-clad or dado-construction.
• The site has excellent access to the Princes Highway and the Geelong Ring Road. It is 6.3km from the Geelong CBD, 17km from Avalon Airport, and is adjacent to the Port of Geelong and the Spirit of Tasmania terminal.
• The asset has very favourable lease terms – with fixed rental increases of 3% annually, has 7 years remaining on the term and two further 7-year renewal options.
• The tenant is the UG Manufacturing Co Pty Ltd company which has some iconic Australian brands under its umbrella, including Quiksilver, Billabong and Roxy.

The needle in the haystack

As alluded to above, Trilogy is very particular when it comes to selecting properties. The first filter that it employs concerns yield.

According to Parisi, agents in Trilogy’s network first submitted the asset for consideration on the basis it met stringent yield requirements.

“A further attraction regarding the yield on this asset was the 50% stamp duty discount on offer for purchases in regional Victoria, including Geelong,” says Parisi, adding that “this saving improves the yield of the asset by approximately 0.2% when compared to an asset for which full-freight stamp duty is paid”.

Why Geelong?

With the yield box ticked, the next important consideration is location. As noted above, the site has excellent access to key transport options, including the Port of Geelong - Victoria’s second-largest port overall and the largest in a regional area.

“It handles a diverse range of cargo, including petroleum products, bulk commodities and containerised goods”, notes Parisi, adding that it plays a key role in facilitating import and export activities, supporting industries across the region.

“The port facilitates over $7 billion worth of trade each year”, says Parisi.

Aside from the port, “What’s so special about Geelong?” I hear you asking.

As Parisi tells it, Geelong has been the beneficiary of significant infrastructure investments in the last decade. These include upgrades to road and rail, and health.

“It is home to several reputable educational institutions including Deakin University and Gordon Institute of TAFE, which provide for a stream of skilled workers to the region”, says Parisi.

These infrastructure investments increase the utility of industrial assets in the area and attract businesses and residents to the area”.

More broadly, Geelong has a diversified economy that includes healthcare, education, advanced manufacturing and a considerable tourism industry.

The Spirit of Tasmania alone brought $21 million in tourism to the region in its first year of operation at Port of Geelong. During the 2022-23 financial year, it also recorded 450,000 passengers and over 160,000 20 foot-equivalent units of cargo.

As a sector expert who has covered all segments, Parisi is keen to point out that “Geelong offers superior housing affordability to Melbourne, making it an attractive destination for home-buyers”.

“It offers a high quality of life with parks and recreation facilities attracting residents and tourists, and is accessible to Bellarine Peninsula and Bells Beach”, says Parisi.

“It is Victoria’s largest regional city with a population of 282,000, which, given the strong economic and lifestyle features on offer is forecast to grow to 325,779 by 2036 – the fastest growth precinct in Victoria”.

The nuts and bolts of this opportunity

The site includes two warehouses that are “both very solid,” says Parisi. Both warehouses have "tilt-panel for the full wall, which is rarer and better quality than the more common metal-clad or dado-construction".

Whilst yield, location, and facilities are important, what about the financials?

According to Parisi, the asset has very favourable lease terms – with fixed rental increases of 3% annually, has seven years remaining on the term and possesses two further seven-year renewal options.

“It is softly rented at $106/m² which makes it a competitive proposition for the existing tenant”, says Parisi.

Speaking of the tenant, the name of the company currently on the site is UG Manufacturing Co Pty Ltd, which has several brands under its umbrella, including Quiksilver, Billabong and Roxy. 

"These brands are icons and have a long history of customer loyalty in the fashion industry", says Parisi. 

Great, what’s in it for me?

The Trilogy Industrial Property Trust is an open-ended trust. The Fund is currently seeking capital to allocate towards new opportunities, several of which it is actively assessing. 

While returns vary month by month, the current yield (based on the 1 Aug 2024 unit price) is 7.21% p.a. While past performance is not a reliable indicator of future performance, the fund has successfully paid investors a monthly distribution since its inception.

The opportunity is open to all retail investors and people can access more information by visiting the Trilogy website, or contacting Trilogy's Brisbane-based Investor Relations team  on 1800 230 099 / investorrelations@trilogyfunds.com.au

Managed Fund

Trilogy Industrial Property Trust

Australian Property

View