Centuria, BGO invest $200m in Sydney warehouse portfolio

ASX-listed property investment group Centuria Capital has announced its third industrial institutional partnership with $134 billion global real estate investment group, BGO, with the pair committing $200 million to Western Sydney’s industrial property market.

BGO has announced the purchase of three off-market warehouses in Sydney’s western suburbs (Smithfield and Seven Hills), snapping up the industrial portfolio from Australian property group Goodman Group.

The portfolio consists of around 45,000 sqm of prime industrial space within tightly held urban infill markets, Centuria said, with a vacancy rate of 2.7%.

The Group, who will serve as investment and property manager for the investment, will take a five per cent interest in the portfolio, with the latest investment offering potential for strong rental growth, Centuria said.

Centuria joint chief executive Jason Huljich hailed the acquisition, which he said illustrates the firm’s ability “to secure rare, off-market quality assets for our institutional partners”.

“With Australia’s burgeoning population increasing demand from the industrial and logistic sector, coupled with limited new supply within infill markets, we believe macroeconomic tailwinds will persist throughout the medium term.

“These factors bode well for our institutional partners as well as Centuria securityholders.”

Huljich welcomed the partnership with BGO, noting the firm will “continue to seek opportunities across tightly held industrial markets”.

“This type of institutional partnership speaks to the strong appetite from international capital seeking to harness the strong domestic industrial sector tailwinds, particularly within infill markets, which benefit from proximity to households and businesses alike.”

Centuria’s institutional capital commitments for industrials now sit at around $2.1 billion, with its industrial platform growing to more than $6.2 billion in AUM, spanning more than 160 assets.

The Group oversees more than $20.5 billion of assets (as at 31 December 2024), with a specialist investment focus in listed and unlisted real estate funds, and tax-effective investment bonds.

BGO, a Florida-based property investment group, and part of Sun Life Financial, noted the potential to further its investment in Australia’s urban infill industrial markets.

The company last year announced the $580 million purchase of a tower in Sydney’s Bond Street – its first foray into Australia’s property sector.