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Colliers transacts super prime south-west Sydney distribution centre

8292 Rodeo Road Gregory Hills

Colliers’ Gavin Bishop, Sean Thomson and Fab Dalfonso assisted Australia’s largest listed pure-play industrial REIT, Centuria Industrial REIT (ASX: CIP), securing an off-market, high-quality industrial facility at 82-92 Rodeo Road, Gregory Hills for $70 million.

The sale of the 22,439m² logistics facility, situated within Sydney’s South-West growth corridor, demonstrates investor demand for super prime industrial investments.

Gavin Bishop, Head of Industrial Capital Markets, Australia, said, “This transaction represents the growing desire for private entities to sell their properties off-market, capitalising on the significant tailwinds within the industrial and logistics sector.”

“Demand for high-quality distribution centres continues to strengthen off the back of the continual rise of the digital economy. Secular trends fuelling modern logistics companies are requiring larger warehousing to cater to the more sophisticated needs of tenants.”

Sean Thomson, Director of Industrial Capital Markets Australia, affirmed, “The shift in investment allocations towards the industrial and logistics sector has added significant depth of capital to the market, which has driven yields to record lows. Nationally, prime industrial and logistics yields have compressed 110 basis points over the past 12 months, with prime yields along the eastern seaboard now averaging 3.85% within core markets as of Q3 2021.”

“The outlook for further compression is favourable, as the spread to the risk-free rate remains broadly in line with the long-term average. In addition, further yield compression in the sector would bring prime yields in Australia more in line with key global markets such as Hong Kong, London, and America where prime yields are closer to 3.5%.”

As of last month, Colliers also helped CIP transact the largest standalone asset within Australia this year for the $200.2 million super prime grade industrial facility at 56-88 Lisbon Street, Fairfield.

Colliers believes that to secure high-quality industrial assets within Sydney, prospective purchasers must be right in line with the current market parameters and factor in the strong market sentiment. There is a robust possibility that capitalisation rates for prime industrial facilities will hit sub 3.25% by the end of 2021.

Fab Dalfonso, National Director Industrial, added “The strong performance of the Sydney industrial and logistics market has continued throughout 2021 with significant momentum being recorded in the occupier markets.”

 

“Macro drivers for industrial and logistics tenancy demand, such as growth in e-commerce and infrastructure investment, continue to support leasing activity across the Sydney market, with approximately one million sqm in occupier requirements currently in the market.”

 

The Australian industrial and logistics sector has been the best performing commercial property sector over the past 12 months as strong fundamentals support elevated demand levels within both the occupier and investment markets.


Related Experts

Sean Thomson

Director, Industrial Capital Markets | Industrial

Sydney

Sean Thomson works for Colliers International as Director of Industrial Capital Markets, Australia, where he specialises in the sale of industrial & logistics assets nationally.

Sean works alongside Gavin Bishop (Head of Industrial Capital Markets, Australia) on a day-to-day basis and holds excellent relationships across a broad spectrum of corporate, private, institutional and international investors.

Having been involved in excess of $14.0 billion of strategic valuation advice, his experience and understanding of the levers which can best maximise value together with the capital markets team’s track record, is integral in achieving the strongest possible result for his clients.

Sean has been involved in many large-scale portfolio divestments including:

  • Qantas Portfolio ($802 million)

  • The Super Core Logistics Portfolio ($186 million)

  • The Greenlit Brands Portfolio ($171 million)

  • Calibre, Eastern Creek ($130 million)

  • The Kaufland Portfolio ($129 million)

  • The AMP Portfolio ($105 million)

Sean holds an unmatched track record in divesting major distribution centres including:

  • The Fairfield Distribtuion Centre ($200 million)

  • Toyota South Sydney ($171 million)

  • 884 Mamre Road, Kemps CReek ($125 million)

  • 59 Lockwood Road, Eastern Creek ($107 million)

  • 37-39 Wentworth Street, Greenacre ($100 million)

  • 1 Eucalyptus Place, Eastern Creek ($91 million)

  • 342 Hammond Road, Dandenong South ($87 million)

Sean has focused on building deep relationships with key global institutional clients, providing the latest in-depth information about the logistics market across Australia, which in-line with his extensive track record, has seen him achieve record-breaking results for his clients.

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Gavin Bishop

Head of Industrial Capital Markets | Australia

Sydney

Gavin is the Head of Industrial Capital Markets Australia and the Head of the NSW Industrial Team at Colliers International, where he has been specialising in industrial property for 20 years. Based in the Sydney CBD Head Office, Gavin manages a highly successful team of over 40 staff across broader Sydney in key industrial precincts.

Gavin specialises in the national industrial capital markets and has excellent relationships across a broad spectrum of institutional, international and private investors. Over Gavin’s time with Colliers, he has completed hundreds of deals in industrial property, settling over $14 billion in his career to date, and leasing over 400,000sqm. Gavin enjoys a 75% market share of industrial capital markets share in NSW.

Gavin has worked extensively in the sale of industrial portfolios of up to 30 assets in one portfolio. Gavin and his team have sold 20/22 of all industrial portfolios in the Australia over the last four years, including the AMP Portfolio ($105m), J.P. Morgan Portfolio ($250m), Altis Portfolio ($342.5m), Qantas Portfolio ($802m) and GIC/Australand Portfolio ($1.073b).

Some major distribution centre sales that Gavin and his team have been involved in over the last two years include, the Calibre, Eastern Creek ($130.1 million), 1 Eucalyptus Place, Eastern Creek ($90.5 million), 3 Roberts Road, Eastern Creek ($253 millions) and 6-20 Clunies Ross Street, Greystanes ($76.6 million)

Gavin has focused on building deep relationships with his clients, providing the latest in-depth information about logistics markets across Australia, which in line with his extensive track record, has seen Gavin achieve record-breaking results for his clients.

Gavin is a long-standing member of the Colliers team, having joined in 2000 as a graduate valuer. Gavin commenced with Colliers as part of their Scholarship Program and he was fortunate to work across multiple service lines and locations across Sydney, before settling in the Industrial team in Sydney South in 2001. Over the last 20 years, Gavin has progressed through the industrial business including managing the Sydney South and Sydney South West offices, before moving into the NSW State Product Director for Industrial in 2010.

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Fab Dalfonso

National Director | Industrial

Sydney South West

Fab's experience in real estate started in 1985 in residential property. In the past thirty five years, he has worked with residential developments, commercial and industrial properties. Fab has a broad client base of government agencies, local, national and international investors.

Fab is a National Director with the South West Sydney team of Colliers. He works hard to deliver the best results for his client and in his career has sold over $1 Billion worth of property. Throughout his career, Fab has been recognised many times in multiple property and agency awards including team member of the year. 
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