Australian real estate fund manager Qualitas has formed a 50-50 joint venture with Melbourne industrial developer Pelligra to develop a A$500m (β¬320m) logistics facility.
Pelligra acquired the former Ford manufacturing in Broadmeadows in May 2019.
The development venture is the fifth transaction in Australia for Qualitasβ Real Estate Opportunity Fund II (QREOFII), taking the gross realisable value of the investments in the fund to A$1.6bn.
The partners will refurbish the former vehicle assembly plant and transform it into the Assembly Broadmeadows facility with 305,000sqm of space to accommodate a range of industrial tenancies.
Andrew Schwartz, Qualitas group managing director, told ΒιΆΉΣ³» Real Assets that the purchase terms, including an 18-month settlement for the key site, were completed prior to COVID-19.
βThrough COVID industrial became a well sought-after sector as last-mile logistics facilities became a hot asset,β he said.
Schwartz explained that Qualitas did not invest heavily in 2019 because of market conditions did not βexactly fit our investment thesisβ.
βIn 2020 and through COVID we uncovered a lot of opportunities that we really liked. These were not distress situations, but they did demonstrate that there was less liquidity in the market. We were happy to allocate our capital to these opportunities,β he said.
Schwartz said the Qualitas team was currently doing due diligence on three more projects for QREOFII. If it proceeds with these, they would effectively fully seed the fundβs portfolio providing a high-level of visibility and predictability on deployment as the fund approaches its final close in mid-2021, he said.
βWe still favour the residential market in Australia. And this fund has a mandate to invest in build-to-sell residential projects,β he said.
Qualitas is looking to be an equity partner with established developers who are starting βto get setβ for the next wave of apartment projects.
The Qualitas opportunity fund is also looking at the office market, with its initial preference in suburban offices.
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