Region. Industrial space demand

Industrial tenant demand in Sydney’s central west (Parramatta. Auburn, Bankstown, Holroyd and Fairfield) remained strong over the first half of 2012, placing an upward pressure on rents, according to CBRE., whose Parramatta MD, Cameron Grier. Said the lightening of A and B stock, particularly over 3000 square metres being the key driver.“ The central west continues to thrive as it offers occupiers a cost effective location and access to major road networks in the geographical heart of Sydney,” he said.

Region. Industrial stock and vacancy

The highest level of industrial vacancy is in the Outer West, however, the pending commencement of several leases is forecast to see the vacancy in this precinct contract as at January 2012,according to Knight Frank’s Quarterly Industrial Market report Outer West, vacancy 285,430 square metres, vacancy rate 42 per cent, average A-grade net rental $110 per square metre; South West 153,117 square metres, vacancy rate 22 per cent, average A-grade net rental $96 per square metre, Central West 206,383 square metres, vacancy rate 30 per cent, average A-grade net rental $113 per square metre.

Region. Demand for industrial facilities

Growing demand for quality industrial facilities in key locations has underpinned a range of significant lease commitments in Western Sydney, according CB Richard Ellis. In one of the larger recent deals, Australia’s leading white and brown goods distributor has committed to lease 13,197 square metres of space in Australand’s EC3 speculative development at Eastern Creek. GPT has also capitalised on increased tenant demand after signing automotive and industrial products distributor YHI International to a 6972-square-metre lease at Rosehill Business Park in Camellia.

South West. Demand remained solid

Demand in the South West industrial market has remained solid over the past six months as companies continue to plan for future growth and take advantage of competitive deals that exist in the market. Two major pre-leases have been signed in recent months at Mirvac’s Hoxton Park Airport development. These were 90,000 square metres pre-lease to Big W, which was signed in March 2011, and 43,000 square metres to Dicksmith.

Western Sydney. Demand remained strong

Colliers International Sydney Industrial Research and Forecast report for first half 2011, said leasing demand, in Western Sydney, has continued to remain strong over the past six months especially from distributors and importers who are increasing stock on hand to take advantage of the strong Australian dollar with the majority of demand being for quality existing freehold space. Speculative development has slowly started to return to Western Sydney with DEXUS, Australand and Goodman all looking to take advantage of the lack of prime grade space.

Erskine Park. New industrial supply

Approximately 89 per cent of the new industrial supply due to complete in 2012 will take place in the Outer West – centred around Erskine Park – underpinned by demand from large retailers and third party logistics providers, according to CBRE research analyst, Gareth Dingle “As occupiers look to cut costs along their supply chains, infrastructure is a critical consideration and this is driving demand in markets such as the Outer North West where 723,468 square metres of space is due to be completed in 2012 – the highest level on record,” said CBRE regional director of industrial, logistics & investments, Joshua Charles.

Region. Resurgence of industrial space

Colliers International recently leased 60,000 square metres of industrial space in Western Sydney over an eight-week period. “The types of businesses that have been committing to these buildings are manufacturers, warehouse and distribution, transport groups and government agencies,” said Gavin Bishop, national director industrial for Colliers. He said land sales in greater Sydney would continue to improve over the next six to 12 months.

Penrith. John Deere leases space

Farm suppliers company, John Deere Tractors, will pay a gross face rent of $93 per square metre after signing a three-year lease, with a similar option, for 1260 square metres of industrial space, in Penrith. Instant Hire was the previous tenant. Colliers negotiated the deal.

Region. Record for new industrial supply

Last year represented a record in the level of new supply in Sydney’s industrial markets, predominantly delivered in the outer and south-west regions, according to Knight Frank’s Sydney Industrial Market report. The level of new supply in 2009 is forecast to be considerably lower than in 2008, with a significant proportion of scheduled projects deferred as their commencement date draws near. Sales activity declined across all Sydney regions during the second half of 2008 as investor sentiment was negatively affected by the downturn in the economic outlook. Sales activity over the last two quarters of the year was 76.54 per cent lower than the average level of activity in the corresponding periods since 2004

Region. Status of industrial markets

Outer North West is driving industrial development and over the 2009-2010 period it is expected to account for nearly a third of all new floor space added to the Sydney industrial market, according to CBRE’s latest Industrial MarketView Report. Another big year is expected in 2009 for new supply in Outer South West, following on from the record levels of floor space completed in 2008. The prediction is for 243,000 square metres of space to complete in 2009. New space is becoming difficult to find in the Central West but the stalling of rental growth over the last couple of years suggests that tenants have decided to look for industrial space in other sub-regions.. Outer Central West is the heart of Western Sydney’s industrial market, with Wetherill Park and Smithfield, ranked first and second in terms of industrial floor space in metropolitan Sydney, however, stock in the area is beginning to age.