The off-market industrial property sale of a site in north-west Adelaide has been handled in a deal worth $18.8 million.

The 29,707 sqm asset – located at 589 – 598 Torrens Road, St Clair – was purchased by Ascot Capital in a move that demonstrates the strength of the growing industrial market.

The property features a 15,000sqm (GLA) warehouse occupied by long-term tenant Trident Plastics – a local firm that manufactures residential rubbish bins, water tanks and automotive components.

Trident, which made a name for itself in 2017 after installing the largest plastic injection moulding machine in the Southern Hemisphere, has a triple-net lease over the facility though to 2028.

Based on the $18.8 million sale price, translates to an initial sale yield of 5.64 per cent.

The off-market sale was managed by CBRE’s Jordan Kies, Chris O’Brien and David Reid on behalf of the Value Partners Asia Pacific fund.

589 Torrens Rd Google Street View

Google Street view of 589 Torrens Rd.

Managing Director & Head of Real Estate Private Equity for Value Partners Group Limited Rachel Tong said the industrial property sale price reflects a significant premium to the book value of the property, which is an excellent outcome for investors in the fund.

“While we are exiting this asset, the fund continues to look for yield accreditive opportunities in Adelaide and elsewhere in Australia given demand from our investors for quality assets in a stable market,” she said.

The fund has invested in logistic centres, offices and student accommodation in Asia Pacific and bought the St Claire property in September 2018.

It has since repositioned the asset over the past one and a half years, including facilitating the site’s rezoning from urban employment to residential.

“Investor demand for industrial assets in South Australia has increased significantly in recent years, with the COVID-19 pandemic having further bolstered buyer interest given the resilience of the industrial & logistics sector,” she said.

The St Clair property is situated 10km from the Adelaide CBD, 6km from Port Adelaide and offers 141 metres of frontage on Torrens Road.

The site is bordered by the St Clair residential estate and represents an infill opportunity.