Goodman Sells Sydney Warehouses to Aliro for $310M in Biggest Aussie Shed Deal of the Year

Goodman Group’s move to focus on data centre opportunities may be creating openings for up and coming investment managers with the Australian industrial giant having sold a pair of Sydney logistics properties to Aliro Group for A$438 million ($310 million) in the country’s biggest shed deal so far this year.

The sale comes a few months after the company led by Greg Goodman agreed to sell the Smithfield Industrial Estate in Sydney to a Barings fund for A$75 million with Goodman noting in February that data centre projects now account for 73 percent of its work in progress.

Now Aliro Group, which raised up to A$800 million from Canada’s Public Sector Pension Investment Board in July last year, has acquired a pair of infill projects benefiting from ongoing development of infrastructure in Western Sydney, with an eye to potential upgrades. 

“The acquisition comprises two infill estates of significant scale in Greystanes and Greenacre, located within established, land‑constrained industrial precincts with exceptional connectivity to Greater Sydney, key population centres and major transport infrastructure,” Aliro said on LinkedIn. “The estates are fully leased, with income underpinned by blue‑chip national and international tenant covenants, with embedded value creation opportunities.”

Boosting Sydney Portfolio

At 2 Foundation Place in Greystanes Aliro is acquiring a building which has 46,381 square metres (499,000 square feet) of lettable area on a 136,540 square metre site about 20 kilometres (12 miles) from central Sydney.

In Greenacre, Aliro is acquiring a building in the Roberts Distribution Centre at 77–85 Roberts Road, which has 15,860 square metres of lettable area on a 46,500 square metre site, with Aliro describing both properties as located in “established, land‑constrained industrial precincts with exceptional connectivity to Greater Sydney, key population centres and major transport infrastructure.” 

Together the properties span 85,200 square metres of lettable area, and reflect a shift to Sydney following PSP’s July investment in its Aliro Group Industrial Vehicle (AGIV). The company pointed to that cash injection allowing it to further build out the fund’s portfolio, which included A$2 billion of assets before this latest transaction.

“The transaction takes AGIV’s portfolio to A$2.4 billion (value on completion), materially advancing its strategy to re‑weight the portfolio toward Sydney,” Aliro said. “It further reflects continued institutional conviction in infill industrial real estate, where structural supply constraints and long‑term demand drivers remain firmly in place.”

At the stated compensation, the company established by Charter Hall co-founder David Southon and Daniel Wise in 2017 is paying the equivalent of A$5,309 per square metre of built area for its latest properties, with the deal indicating an initial yield of 4.2 percent and a market equivalent yield of 5.5 percent on a transaction that Colliers ranks as the biggest in the industrial sector in Australia this year. 

AGIV’s industrial portfolio includes 12 properties, according to the Aliro Group website, with eight of those assets in Victoria state and three in Sydney.

Among the tenants in its latest properties are data storage provider Iron Mountain, 3M, countertop maker Laminex and Australia Post, with the assets carrying a weighted average term to lease expiry of about five years. 

Goodman Shifts Gears

Goodman had held the two properties sold to Aliro through its KWASA-Goodman Industrial Partnership established in 2012 with Malaysia’s Employees Provident Fund, with the Aussie industrial specialist disposing of the sheds as it announces a flurry of new investment initiatives globally as it develops what it describes as a 6.0GW powerbank of data centre projects.

In January the ASX-listed developer and fund manager said it will invest A$5 billion developing “Project Atlas,” a 500MW data centre project on the site of its existing Coles NDC logistics park in Sydney’s Eastern Creek area. 

That Australian project was announced less than a month after Goodman unveiled an A$14 billion European data centre partnership with Canada’s CPPIB 

Earlier this month the company won approval for a data centre in Los Angeles, and in October last year acquired a San Jose, California data centre site for $200 million.