The Irongate Group (ASX: IAP) share price will be on watch today following the acquisition of an industrial property. The announcement was made after market close yesterday and could have an effect on its shares today.
The diversified real estate investment trust ended Monday’s trading session 1.1% down to $1.26.
Irongate share price in focus
The Irongate share price could be on the move today as investors had time to digest the latest release overnight.
In its announcement, Irongate advised that it has entered a contract for sale of land to acquire an industrial facility.
Under the agreement, Irongate will pay a total amount of $24.75 million to the vendors of the property. The purchase consideration and transaction costs will be funded by the company tapping into its existing debt facility.
Built in 2018, the industrial complex is located on Main Beach Road in Pinkenba, Queensland. The building comprises 1,852 square meters of office and warehouse space and 33,165 square meters of paved areas for vehicles. Currently, the property is tenanted to Grays, which is the largest industrial, auto and commercial eCommerce business in Australia. The lease expires in March 2028 and has a fixed annual increase of 3.5%.
The settlement date for the acquisition of the property is expected to occur on 22 March 2021.
What did the CEO say?
Irongate CEO Graeme Katz touched on the deal, saying:
The Property provides IAP with a strategic land holding of almost four-hectares in the Australian Trade Coast Precinct, one of Brisbane’s premier industrial locations. Pinkenba is immediately adjacent to Brisbane Airport and the area will benefit from infrastructure upgrades associated with the new Brisbane International Cruise Terminal.
We believe the Brisbane industrial sector currently offers relative value and the acquisition will increase IAP’s exposure to industrial property to 32% by both income and value.
The Irongate share price is down just over 10% in the last 12-month period.