Adelaide refrigerated warehouse hits market amid hot demand

A South Australian cold-store warehouse has hit the market as the demand for food storage facilities rides high as a result of the pandemic.

The warehouse located 27km from Adelaide’s CBD generates $3,588,662 per annum and is fully leased to refrigerator logistics provider Rand Transport Pty Ltd.

The company holds a 15-year lease with fixed rental increases of 3.5% per annum.

JLL’s Tony Iuliano says the lucrative property has been listed amid soaring demand for these types of assets.

“Refrigeration distribution centres have become an increasingly popular investment class in recent years primarily because of the longer lease stability in income,” he says.

“Refrigerated logistics and distribution facilities leased to blue-chip supermarkets, or food distribution businesses, are typically set with long-term leases.

“The demand for modern logistics space that has been prevalent in the market for the last few years has been accelerated significantly with the onset of the COVID-19 pandemic and subsequent restrictions on public movement.”

The site at 16-26 Caribou Drive in Direk is being sold on behalf of Cromwell Property Group and includes a cold-store facility with an office, temperature-controlled freezer, a plant room area and workshops.

The temperature-controlled warehouse areas at varying clearance heights generally range from 10m to 16m.

While temperatures range from -22C to 14C.

Rand Transport Pty Ltd is a leading national refrigerated transport operator and has been a service provider to the food industry for more than 30 years.

JLL’s Adrian Rowse says demand in the sector is also expected to outlast the pandemic.

“Prime drivers of demand for frozen and chilled products have been a result of population growth and real household disposable income,” he says.

“The high consumption non-discretionary throughput (i.e. groceries), which is relatively demand inelastic, will continue to push the need for industrial floorspace in the market.”

Expressions of interest close on August 5.