This article is from the Australian Property Journal archive
NATIONAL Foods has sold a vacant industrial land at Lidcombe in western Sydney to global IT services company Synnex Australia for $10.5 million.
CB Richard Ellis negotiated the sale of the 16 Parramatta Road site, which at 2.1 hectares is one of the last remaining large parcels of vacant industrial land in the Central West. The property was sold by National Foods, after being identified as surplus to their requirements for the operation of the Dairy Farmers facility at nearby Birnie Avenue.
Synnex intends to build a state-of-the-art office/warehouse facility on the site to serve as the company’s new Sydney headquarters.
CBRE Parramatta managing director Cameron Grier said Central West has emerged as Sydney’s most resilient industrial market in the wake of the GFC, following a spate of major sales and leasing deals.
Over the past three months, CBRE has also leased over 15,000 sqm of industrial space in business parks throughout the Central West, with the most recent deal involving a 5,314 sqm lease to S&R Logistics.
Grier said a scarcity of vacant industrial sites had also underpinned land values in the area – even during the worst of the GFC, when land prices across western Sydney had fallen on average between 25% and 40%.
“The Central West defied the trend, with land values remaining very resilient. Indeed, in some cases in the past 12 to 18 months we have witnessed transactions above 2007 pricing levels in Sydney’s Central West sub region which takes into account suburbs such as Homebush, Lidcombe, Auburn, Silverwater, Rydalmere and Chullora.
“Demand for land in this area is always going to be strong as it’s regarded by many industrial users as Sydney’s most central distribution point,” he added.
Next door at 17-19 Parramatta Rd, American retail giant Costco also has plans to build its second Australian store after opening in Melbourne’s Dockland’s precinct. This will be its first store in Sydney and will also serve as its Australian head quarters.
“Bevchain Logistics has recently moved into a new facility on Percy Street and Lion Nathan are looking to expand their premises on Nyrang – moves which will further enhance the long term investment potential of the area,” Grief said.
CBRE negotiator, industrial & logistics services, Shaun Timbrell said the strength of the Central West had also been reflected in recent leasing transactions such as the 10-year S&R Logistics deal at 350 Parramatta Rd.
“The S&R lease accounted for one of the last vacancies upwards of 5,000 sqm in this area and achieved a rent of $112.5 per sqm, which is considered at the higher end of the rental range for straight warehouse accommodation,” Timbrell said. “Enquiry throughout Lidcombe and Homebush is at an all time high and with vacancy levels dwindling we are seeing tenants lock into long term leases.”
Timbrell said the lack of opportunities was expected to underpin strong interest in the upcoming lease of the former Ryobi space. CBRE was recently appointed by ING Industrial Fund to lease the 8,800 sqm corporate office/distribution facility which would become available in April 2011, when Ryobi vacated.
Australian Property Journal
