SYDNEY INDUSTRIAL DEALS IN HIGH DEMAND
Demand for industrial property is riding high with a string of lease and sales deals by investors and tenants keen to get a foothold into the market.
Tian Yuan P/L, a private local investor, paid $5.35 million for an industrial facility in the Fairfield East Industrial Precinct, reflecting a yield of 6.5 per cent, in an off-market deal brokered by Savills Australia.
Savills industrial executive Moshe Greengarten, who negotiated the deal with director Ray Trimboli, said the location of the facility was a factor for the buyer as they have a property nearby.
Located at 4-6 Seville Street, Fairfield East the property comprises 4546 square metres of office and a warehouse on a 5574-square-metre site with a long-term lease.
Mr Greengarten said the new owners wanted access to the surrounding arterial roads across three major Sydney transport routes.
Mr Greengarten added that the hunt continues by investors for easily manageable assets with strong leasing covenants and access to major arterial roads and highways, which is resulting in a tightening of yields for industrial assets.
On the leasing front, Goodman Group has secured 28 new customer commitments totalling 28,074 square metres at Sydney Corporate Park this calendar year.
Goodman general manager, Australia, Jason Little said the customer demand for the warehouse and distribution space was strong given the park’s strategic location and proximity to Port Botany and Sydney Airport.
“Since the acquisition of Sydney Corporate Park in December 2013, Goodman has made a number of improvements at the estate, including the refurbishment of buildings, upgraded landscaping and the introduction of new signage,” Mr Little said.
There are also a number of diverse entertainment and retail facilities that have seen the park come into its own as a tourist destination.
The recent deals include a 10-year commitment to Recall for 2036 square metres in the newly refurbished 170-180 Bourke Road office building. Recall has relocated its Australian head office to these new premises and joins Breville, which leased 4309 square metres in late 2014.
Separately, Retailer Bras N Things has committed to 1064 square metres, with an eight-year lease term for its head office and Red Bull has leased 3114 square metres in the newly refurbished 55 Doody Street building on a five-year lease term.