Sydney investors swoop on Brisbane industrial assets

Brisbane’s industrial market is continuing to shine, with Sydney investors snapping up properties, including the completion of one of the year’s biggest industrial land deals.

Almost 10 years in the planning, a 24.6ha parcel of land at Heathwood, on the Logan Motorway south of Brisbane, has been sold with a view to develop the site for large scale pre-leases in excess of 10,000sqm.

The Heathwood site was sold to Sydney-based LOGOS Property, which plans to develop the entire land holding into a premium logistics estate with an end value in excess of $200 million.

It will be the largest single holding on the Logan Motorway corridor, with direct exposure to the motorway and access provided by the Stapylton Rd interchange.

Meanwhile, another 2.1ha industrial property in nearby Oxley has sold to Sydney-based boutique funds manager Pipeclay Lawson for $8.215 million, on a yield of 7.87%.

The Oxley site, which is located at 141a Boundary Rd, is currently home to a 3141sqm facility and occupied by Chep Australia Ltd, with the lease expiring in August 2020.

The property returns about $646,500 annually.

Speaking about the Heathwood deal, JLL’s industrial director Gary Hyland says the sale is exciting for the sector, as the estate could accommodate facilities in excess of 50,000sqm.

The Oxley site in Brisbane is owned by Chep Ltd

“The Logan Motorway corridor is South Estate Queensland’s major warehousing and logistics hub providing occupiers with unrivalled access to all major arterials that service the immediate South East Queensland market as well as interstate markets,” Hyland says.

The estate will be branded Heathwood Logistics Park and with earthworks now completed the estate is available for immediate development.

“Having a buyer who is now firmly committed to a quality large scale development means that demand can be met. Already we have strong interest from a number of groups looking to capitalise on the site’s direct motorway access and exposure,” Hyland says.

Coles and Woolworths both have distribution centres that neighbour the estate.

Colliers International director of industrial Adam Wills, who negotiated the off-market Oxley deal, says the high profile site was flood affected in 2011, but the buyer has assessed the future risk to be minimal.

“The properties that have been flood affected have received considerable discounts and in this case, the deal was negotiated on a sharp yield,” Wills says.

“The site represented a rare opportunity due to its low site cover, which lends itself to future opportunity to potentially redevelop, in a high profile location.”

“Similar sites are already scarce and with the price of prime industrial land continuing to rise it is becoming less feasible to develop sites with large concrete yards at competitive rates.”

The facility offers two street frontages and is located opposite to Bunnings Warehouse, with direct access to the Ipswich and Centenary motorways.

Chep Australia has occupied the site since 1992 and renewed its lease after the 2011 floods.