Port Botany: the heavy hitting investment game in Sydney’s South

In early 2014, Scott Spanton, CEO of Tipalea Partners fought aggressively to acquire Portside Business Park at 73-79 Beauchamp Road in Banksmeadow via a competitive Expressions of Interest campaign. The estate had the right property fundamentals, being a boutique estate of six units, well maintained, with each unit circa 1,070sqm in size and close to Port Botany. This was meant to be a simple set and forget.  How time changes ones view.

With a 30 per cent increase in net rents and sales values in 2016, and a lack of stock for sale, Tipalea Partners chose to strata subdivide the estate into a multi-unit industrial complex comprising six double storey modern office and warehouse units, constructed within two buildings, ranging in size from 1,068sqm to 1,293sqm and sell off the individual units to investors and owner occupiers.

Colliers International agents Michael Crombie and Edward Princi initially took to market to sell two units, with a 2017 lease expiry – angled towards the owner occupier.  Both units were sold above the asking price within five days of the launch to a local investor with Unit 1 comprising 1,069sqm and Unit 4 comprising 1,070sqm for $3.848 million and $3.852 million respectively.

Tipalea immediately decided to put all the other units on the market and the results have been strong, quickly selling Units 3, 6 and 2 with an average of $3,600 per square metre for each unit, and yields ranging from 4.19 per cent - 4.95 per cent.

When Tipalea acquired the site in 2014 paying $1,778 / sqm on building area, the total sale price was $11,800,000, and in less than two years, the total on sale will amount to close to $24,000,000.

Scott Spanton, CEO of Tipalea Partners said the market has certainly shifted, highlighting the rapid growth in the area.

“South Sydney’s industrial market continues to be one of the most tightly held sectors across Sydney and wider NSW, as land supply remains low and investor demand skyrockets. I believe that the quick sell out is a testament to this strong demand and a big tick for buyer requirements” he said.

Unit 5 is the last unit to be sold, being a 1,068sqm leased investment, at market rent, with a market review around the corner. 

According to Michael Crombie, National Director and Director in Charge of South Sydney at Colliers International, “There is consistently strong growth in the area, especially properties zoned IN1 general industrial. This estate has continued to perform well and will make a sound investment”.

The property has a prominent location on Beauchamp Road, being a B Double approved route in the southern Sydney suburb of Banksmeadow, which runs North off Botany Road to the South and Denison Street to the North. 

The high clearance, clear span warehouses offer double width roller door access, as well as ample car parking and the ability to operate 24/7 with no impact or encroaching residential users, subject to council approval.

According to Edward Princi, Director of Industrial at Colliers International, “Beauchamp Road is within close proximity to Port Botany, Kingsford Smith Airport and has easy access to Eastgardens Shopping Centre and main arterial roads.

“We expect demand for quality assets in the area will continue to rise well into 2017” he said.

73 Beauchamp Road Banksmeadow

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