Stockland is buying a major industrial development site in Leppington, near the Western Sydney International Airport, construction of which recently started.
The purchaser has earmarked the 10.3 hectare Bringelly Road parcel for a logistics focused business park containing three buildings with 58,000 square metres of lettable area.
Construction should begin next year with first earnings expected in FY23.
In FY24, Stockland is estimating an end-value of c$145m (assuming a target yield of 5.5 per cent).
“We’re delighted to…increase our weighting to quality logistics assets on the eastern seaboard, in line with our strategy to strengthen our commercial property portfolio through improved income and valuation resilience,” the institution’s chief executive officer Louise Mason said.
“With appropriate zoning and civil works development approval in place, this project can commence quickly and will allow us to leverage our development and asset management capabilities,” according to the executive.
Logistics sector to prove resilient after COVID-19: Stockland
Stockland general manager, Workplace and Logistics, Tony D’Addona said “we expect the logistics sector to prove resilient to the impacts of COVID-19 relative to other sectors, and foresee favourable market fundamentals continuing in the longer term” (story continues below).
“We have successfully completed over $150m of…developments in these markets over the past 12 months, and 90pc of this space is leased.
“We currently have $1.1 billion invested across eight high quality logistics assets in western Sydney with and additional $600m planned for…logistics development, which will enable us to benefit from the investment boom generated by the future Western Sydney Airport.
“The precinct has been a significant driver of occupier activity over the last five years, accounting for 23pc of Sydney’s gross take up over that (year) period.
“Developing this prime asset in a key growth corridor will enable us to both leverage our existing customer relationships in the logistics space and welcome new, high quality tenants into the portfolio”.
The purchase price for the Leppington site has not yet been confirmed.
Recently a 1.3ha site at 14 Eastwood Rd in the suburb traded for $7.5m.
Today we also reported a 3.96ha poultry farm at Badgerys Creek sold for $14.5m setting a record rate per sqm of raw unserviced land.