Invest
Realside's Ovest industrial Fund aims for $40 million growth through fully-leased portfolio
Invest
Realside's Ovest industrial Fund aims for $40 million growth through fully-leased portfolio
In a strategic move to capitalise on the burgeoning demand for fully-leased industrial assets, Realside has announced its intent to raise over $40 million for its Ovest industrial Fund by June 30. This initiative is aimed at delivering returns that surpass those of typical institutional funds, promising a total return of 13.0% per annum over a five-year investment term, alongside an average cash distribution of 7.0% per annum.
Realside's Ovest industrial Fund aims for $40 million growth through fully-leased portfolio
In a strategic move to capitalise on the burgeoning demand for fully-leased industrial assets, Realside has announced its intent to raise over $40 million for its Ovest industrial Fund by June 30. This initiative is aimed at delivering returns that surpass those of typical institutional funds, promising a total return of 13.0% per annum over a five-year investment term, alongside an average cash distribution of 7.0% per annum.
The Realside Ovest Industrial Core Fund No. 1 has opened its recapitalisation phase as planned, following a successful initial term that concluded earlier this year. During this period, initial investors enjoyed total returns of 16.76%, exceeding the targeted 14%. This impressive performance was achieved through the development of industrial land and strategic value-add initiatives across six industrial assets in Western Australia.
Now fully developed, the Fund's portfolio boasts a valuation of $183.5 million. It includes a diverse range of tenants such as ARC Group, Elders, Mader Group, Bestbar, and Rubbergem, all contributing to the portfolio's high yield and stability.
Linda Rudd, CEO of Realside, emphasised the significance of secure income in today's volatile market. "The case for secure and stabilised income from a fully-developed and fully-leased portfolio is always compelling, but this is elevated at a time when there remains a high level of uncertainty in investment markets at present given the current geopolitical environment," Ms Rudd stated. She further highlighted the attractiveness of "high-quality, fully-leased, institutional grade property in markets with favourable long-term fundamentals."
The Ovest industrial portfolio is strategically positioned in one of Australia's most tightly-held and high-performing industrial markets. This ensures robust tenant demand and limited new supply, providing a solid foundation for the Fund's growth prospects. The portfolio's assets are 100% leased, underscoring the strength of its underlying fundamentals.
Since its inception in 2021, the Fund has been meticulously assembled through a disciplined acquisition and development strategy. This has been executed by the joint venture between Realside and Realside Ovest, with Realside serving as the Fund Manager and Realside Ovest, under the leadership of Julie Drago, acting as the Asset and Development Manager.
Ms Drago elaborated on the Fund's strategic advantages, stating, "The Fund provides investors secure and stabilised income with mitigated risk in the immediate term and, through active asset management and the capture of embedded rental reversion, predictable growth potential moving forward." She also noted the continued interest from initial investors, adding that "while many initial investors have elected to maintain their investment in Ovest, this recapitalisation enables new wholesale investors to participate at an opportune time in the cycle."
A significant feature of the Ovest industrial portfolio is its 9-year weighted average lease expiry (WALE) by income, which offers strong income visibility and stability for investors. This long-term lease structure is a key component of the Fund's appeal, providing a predictable income stream in a market characterised by uncertainty.
The collaboration between Realside and Realside Ovest has been pivotal in the Fund's success, with both entities bringing their expertise to bear on asset acquisition and management. This partnership has enabled the Fund to navigate the complexities of the industrial property market effectively, positioning it for continued success in the years ahead.
As Realside seeks to attract new wholesale investors, the Ovest industrial Fund stands as a testament to the potential of well-managed, fully-leased industrial properties. With a focus on delivering superior returns and stable income, the Fund is poised to meet the needs of investors seeking security and growth in an unpredictable economic landscape.
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