Botany site sells for more than $25m

Colliers says its Industrial Director, Tom Barnier and Industrial Executive, Jeremy Green have sold a 7435 sqms Botany site to Coombes Property Group at a land rate of $3400 per sqms.

The Hale Street property in southern Sydney’s Botany was sold to the company for $25.25 million in what Colliers says confirms Southern Sydney’s industrial market as going from strength to strength.

The investment management company notes the site comes with rare IN1 General Industrial zoning, significant frontage to Hale Street and immediate access to Foreshore Drive and the M5 Motorway.

“The buyer has historically focused on acquiring commercial property, and this transaction is their first substantial industrial purchase in South Sydney,” Tom says.

“This signifies the strength of the industrial property market and the buyer’s vision to capitalise on one of the most rapidly growing and highly coveted asset classes in the wake of the pandemic,” he adds.

“Coombes Property Group has a vision to add value to this site over time, based on there being an extreme lack of industrial land, coupled with record low vacancy levels.”

Colliers says Coombes Property Group is a private organisation that owns, develops, and actively manages a diversified property portfolio. It intends to improve the property and remain a long-term holder of the asset.

“This is a landmark sale and the price achieved is substantiated by the fact that 2-4 Hale Street is one of the last remaining large-scale development sites remaining in Botany, further adding to the significance of this transaction, and highlighting the demand for prime land in South Sydney,” Jeremy says.

Colliers notes the property has a total of 11 leases and comes on the back of record low vacancy rates and a severe shortage of stock, particularly in Botany, Mascot, and Alexandria with the Sydney industrial vacancy rate now standing at 1.5 per cent while there are many individual precincts well below this level.

“Primarily due to the limited prime assets on the market, we have begun to see that the capital seeking industrial and commercial property has started to shift towards securing development land for investors, aiming to create their own purpose-built assets,” Jeremy says.

“This is exactly what we have seen in this deal and will continue to see in South Sydney as there is still so much unplaced capital to be invested,” he adds.

“We’re delighted to have secured this asset in what we see as a prime location in an extremely attractive segment of the market,” Michael Coombes, Coombes Property Group CEO says.

Colliers notes the lack of vacant sites left for development in South Sydney has caused prices to increase, especially for land.

It says the withdrawal and rezoning of industrial land for alternative uses has placed substantial pressure on the area’s remaining industrial land stocks.

According to Colliers’ latest research, estimates show there is only 27.2 hectare of vacant industrial zoned land within South Sydney, while more than 120 hectares of former industrial land have been rezoned for other land uses since 2012.

Colliers also recently transacted 3 Burrows Road South in St Peters for $11.55 million, as another prominent site with potential for industrial development. It says this further showcases the market’s strength with the 3617 sqms site selling at a yield of 3.2 per cent.

For more information on Colliers, click here.

 

 

 

 

 

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