Low site coverage sites are growing in demand in Western Sydney, according to a property expert from CBRE.
John Micallef, Director at CBRE Asia Pacific, specialises in the sales and leasing of industrial assets in Western Sydney and says the reason for the spike in interest is due to a small supply of low site coverage sites.
“There is a severe lack of land supply in Western Sydney, and due to the cost of land approaching $1000 per sqm, it’s uncommon for a site with excess land area to not be developed,” he says.
John says the demand for these types of sites is predominantly from users within industries such as transport, construction, infrastructure, building supplies, hire companies and more.
“With the substantial population growth and infrastructure investment, these companies are growing and will naturally need to occupy more space over time,” he says.
“We believe this will certainly continue, especially with the development of Badgery’s Creek Airport.”
CBRE has recently let two low site coverage sites in Western Sydney – one in Smithfield for Jaybro and one in Glendenning.
Jaybro, which signed a five-year deal on the site, had been looking for a low site coverage site for more than six months when they secured the lease at 60 O’Connell St.
John says the deal was closed exceptionally fast, with Jaybro signing within seven days to lock down the highly sought-after property.
At the Glendenning property, located at 43 Cox Place, the tenant had also been searching for an appropriate site for more than 12 months.
It was leased 14 months in advance of when the facility would be available.
“Both sites were let with low incentives, due to the rarity of the offerings and the huge demand for low site coverage sites,” he says.
John says it will only get harder to find sites with larger yard components.
“No developers are willing to create this sort of product as land is so expensive, so they need to maximise their site coverage for their developments to be feasible,” he says.