AMP Capital Global Direct Property Fund (GDPF) has acquired 12900 West Airport Boulevard (12900 Airport), an industrial property located in Houston for US$17 million. The Fund has been an active buyer and seller of US real estate with this acquisition being the fifth transaction in the last 12 months.
The property is a Class A, 27,846 square metres, 100 per cent leased, single tenant industrial property, built in 2007. 12900 Airport is located in a core Houston industrial submarket of Sugar Land and features cross-dock loading with 72 loading docks and 80 car parking spaces.
AMP Capital Global Direct Property Fund Manager Tim Fallet said the property was attractively priced with the opportunity to add value.
“We are pleased with this off-market transaction, which was acquired at a favourable price relative to recent comparable transactions and well below replacement cost,” Mr Fallet said.
“The property is significantly under-rented and there is the opportunity to add value by renegotiating the lease with the current tenant or if they leave in 2015, releasing the vacant space at higher rents, especially given the strong demand for high quality industrial space in Houston.
The Greater Houston industrial market is the sixth largest industrial market in the US and home to over 468 million square feet (43.5 million square metres) of warehousing space. The Greater Houston industrial market remains among the strongest industrial markets in the US and the current warehouse vacancy rate in Houston is 4.5 per cent.
“While the Fund currently has a buy-side bias to the United States, we expect transaction activity to pick up in its Asian and European target markets over the next 12 months,” Mr Fallet said.
The AMP Capital Global Direct Property Fund provides Australian superannuation funds with access to core and core plus direct property investment opportunities in large, liquid and transparent offshore markets. The fund invests in a strategic mix of international direct property assets across all the property sectors.