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485 Dohertys Road

Investment

485 Dohertys Road, is a newly constructed, state of the art logistics centre located in the industrial precinct of Truganina, 19 kms to the west of Melbourne. The property is 100% occupied by Coles, on a 20-year lease that expires in 2032. CorVal acquired this property on behalf of one of its family office investors in 2012 on a development fund-through basis.
CorVal was able to access this off-market opportunity as a result of the deep relationships forged in the industrial market over 30 years. The developer of this property was working with an offshore equity partner to fund the project, however this party pulled out of the deal shortly before funding was required. The developer then approached CorVal, offering the opportunity to fund the development as CorVal was well known to the developer and has a reputation for being able to act quickly with a track record in completing fund-through transactions. As CorVal was able to complete the deal within 5 days, it was able to secure favourable terms for its investor.

Strategy

CorVal’s experience with fund-through investments enabled it to agree all documentation including the option, sale and purchase agreement, plans of subdivision, agreement for lease and building contracts. CorVal was also able to assess and mitigate the risks associated with these types of investments by agreeing amendments to certain documents within the 5-day timeframe.
Corval successfully settled the acquisition of the land and then managed the construction of the building, which was delivered on time and on budget.

Outcome

CorVal was able to secure this investment, on behalf of a private mandate, at attractive pricing reflecting a yield of 8.2% on the total cost of c$57.3m. In August 2016 this property was sold for $102.5m delivering a 3 times equity multiple to the investor.