Fortescue Metals mining billionaire Andrew “Twiggy” Forrest is betting big on a strong recovery in the WA economy and property market after backing Perth’s largest new industrial estate through his private family investment vehicle Minderoo Group.
The new $500 million estate, called Roe Highway Logistics Park, officially launched on Wednesday. Covering 56 hectares of rezoned former rural lands, it lies about 13 kilometres east of the Perth city centre on the Roe Highway in Wattle Grove.
Minderoo Group has come on board as the project’s capital partner in a 50-50 joint venture with the estate’s developers Linc Property, East Coast-based Gibb Group and Fini Group, the private investment company of Perth developer Adrian Fini.
The planned development budget is between $350 million and $400 million on top of about $120 million already spent by developer Linc Group to acquire the amalgamated site from more than two dozen landowners in 2017.
John Hartman, Minderoo Group chief investment officer, said the investment in the new estate was part of broader plans by the Forrests to diversify beyond mining with property development a big part of this strategy alongside agriculture and energy.
“This is our first major industrial investment and we are the largest investor,” Mr Hartman told The Australian Financial Review.
“We believe this logistics park will be a game changer in Perth because of its strategic location, its ability to service large-scale requirements and its intermodal [transport] access,” he said.
The logistics park will offer lots from 2000 square metres to more than 10 hectares with freight rail access via the Kenwick Freight Rail Facility due to be completed in 2020.
The estate is about 50 per cent pre-committed with an occupier list that includes freight and logistics groups Northline and K-Trans WA, who will both lease new warehouses on the site and a new workshop for international oil and gas services business Expro Group.
Linc Property co-founder Ben Lisle said the plan was to develop and retain the majority of the estate through leasing deals, with a small portion to be sold to owner-occupiers such as BP, who will develop an integrated fuel station and truck stop on the estate.
As much as 80-90 per cent of the estate is expected to be leased up by the end of the year, Mr Lisle said.
“We are in advanced discussions with a number of larger tenants and anticipate that the RAV 7 [truck] road access, the freight rail intermodal terminal, modern presentation and ability to tailor facilities or lots to tenants’ exact requirements will drive very rapid take-up of the remaining land,” he said.