Demand for DCs in Sydney’s southwest: Colliers

According to Colliers, there is demand for DCs and last-mile hubs in Sydney’s southwest as the industrial and logistics sector expands due to e-commerce and rental growth.

The investment management company says industrial property rental growth increased by 9.4 per cent throughout 2021 in the inner southwest, including Bankstown, Milperra and Padstow industrial precincts.

It notes this is happening because occupiers want to store their inventories in warehouses that are close to their consumers.

Colliers’ Trent Gallagher and Hamish Miles are sharing the listing with LJ Hooker Commercial’s Jon Orsborn with the price guide being more than $25 million.

“This unique investment opportunity offers purchasers a rare opportunity to secure a substantial land holding in the booming inner southwest market, offering substantial rental reversion uplift through building refurbishments and/or splitting buildings to maximise rental returns,” Trent says.

“It also offers prospective buyers the ability to capture increased tenant demand in a market with record-low vacancy rates,” Hamish adds.

Colliers says infill market rents across Sydney grew by 10 per cent last year, which it notes was well above the 3.8 per cent for outer-ring submarkets over the same period.

It also says prime rents in the inner southwest precinct have recorded a compound annual growth rate of 3.4 per cent over the past decade, which is well above the broader Sydney average of 2.8 per cent per annum over the same period.

It says the precinct is expected to grow as demand exceeds available supply.

Investors can obtain a part of this precinct by bidding for 36-48 Ashford Avenue in Milperra, which is for sale via expressions of interest till Tuesday April 19 4pm (AEDT).

The property has a total land area of 11, 200 sqms and 90 m frontage on Ashford Avenue. It is split across two buildings and comes with IN1 General Industrial zoning and is suitable to buyers who want something with flexibility.

“This is an exceptional gateway for purchases to position themselves in the infill Milperra pocket and take advantage of the current gentrification of the area,” Jon says.

Colliers says the property is a unique opportunity for owner-occupiers, investors, or value-add buyers, especially because it has a warehouse clearance of up to 10.8 metres, modern office accommodation throughout and ample on-site designated parking spaces.

It also says prospective occupiers and investors can capitalise on the area’s booming rental market.

For more information on Colliers, click here.

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