TPG Angelo Gordon Buying 80% Stake in Aussie Logistics JV for $125M

US fund manager TPG Angelo Gordon has agreed to acquire an 80 percent stake in a newly launched logistics partnership with Growthpoint Properties Australia, an ASX-listed REIT, for A$181 million ($124.7 million).

The Growthpoint Australia Logistics Partnership’s seed portfolio consists of six industrial properties currently held by Growthpoint Properties Australia, according to a Tuesday stock filing. Growthpoint entities will hold the remaining 20 percent interest in GALP and serve as investment and property manager.

TPG AG is making its acquisition in line with the assets’ June book values, Growthpoint said. The credit and real estate arm of Texas-based TPG will hold a 95 percent stake in two assets in New South Wales and a 60 percent ownership in three Victoria assets and a Queensland asset.

“We are pleased to form this capital partnership alongside an aligned global institutional partner with extensive investment experience,” said Growthpoint CEO and managing director Ross Lees. “This partnership supports Growthpoint’s strategy to grow its funds management business and capital partnerships, and is a testament to the strength of our industrial portfolio.”

Suburban Sydney Seed Assets

GALP’s top asset by book value is 6-7 John Morphett Place in Erskine Park, New South Wales, about 39 kilometres (24 miles) west of central Sydney. Valued at A$84 million and spanning 24,881 square metres (267,817 square feet) of lettable area, the 2008-vintage complex consists of a two-level office building and warehousing facilities tenanted to logistics operator Linfox.

The other NSW asset, 81 Derby Street in Silverwater, is valued at A$33 million and was purpose-built in 2000 as a printing facility with adjoining offices over two levels. Located just 16 kilometres west of Sydney’s CBD, the 8,062 square metre property can be easily repurposed for warehousing, according to Growthpoint.

The sale of the seed portfolio remains subject to regulatory approval and is expected to close in December, with Growthpoint planning to use the proceeds to repay debt.

On Wednesday, Growthpoint announced the disposal of its entire 15.1 percent holding in Dexus Industria REIT for a total consideration of A$131.7 million ($90.8 million).

”The investment in DXI was no longer considered a core strategic investment and now is the appropriate time to realise the value in this investment,” Lees said. “Proceeds of the sale will initially be applied to the repayment of debt demonstrating our commitment to active management of the Growthpoint balance sheet.”

Fund Commitments

The Australian tie-up comes after TPG announced $2.5 billion in commitments for two Asia-focused real estate funds in May. The firm has raised a respective $2 billion and $417 million for TPG AG Asia Realty V and TPG AG Japan Realty Value.

Asia Realty V, which closed more than 50 percent higher than the $1.3 billion fourth fund, targets opportunistic investments with a focus on sourcing off-market transactions in Japan, South Korea, mainland China, Hong Kong and Singapore.

Japan Realty Value seeks value-add opportunities in Asia’s second-biggest economy, focusing on equity interests in real estate across industrial, office, residential and retail.

TPG also closed on its eighth Asia-focused private equity fund with $5.3 billion in committed capital, according to the May announcement, making the vehicle TPG’s largest-ever fund targeting the region.