Billionaire Bob Ell offloads three Sydney industrial sites

The property tycoon sold a portfolio of three tightly held industrial precincts in a deal that reveals the strength of the market.

Tycoon Bob Ell’s Leda Holdings has offloaded a portfolio of Sydney assets to funds house Pittwater Industrial in a $95m deal that shows the strength of the market.

The portfolio spanned three assets – 247 King St, Mascot; 6 Shale Place, Eastern Creek; and 87-91 Victoria St, Smithfield – with Colliers acting on the byside for the purchaser.

They are in three of Sydney’s most tightly held infill industrial precincts and fully leased with a weighted average lease expiry of 1.4 years, allowing the buyer to put in place value add strategies.

The properties have 18,169sq m of improvements and sit on a combined site area of 25,449sq m. The deal was struck on a crisp passing yield of 3.2 per cent and showed a core market capitalisation rate of 4.54 per cent. Colliers agents Gavin Bishop, Sean Thomson, Trent Gallagher and Paul McGlynn advised Pittwater.

The Mascot property has nine offices and warehousing spanning two levels, occupied by nine separate tenants. The site comprises a functional industrial estate totalling 10,536sq m and site area of 13,684sq m.

It is known as the King Street Business Park, with a near level internal parcel at street level and a single street frontage to King St. The property is near Mascot Train Station and surrounding developments.

Pittwater will redevelop it into a multi-level logistics estate, which would be snapped up in the tight South Sydney market.

The Eastern Creek industrial facility spans 3933sq m on a site area of 5771sq m, with a mixture of office and warehouse space. It is an industrial land subdivision that connects through to Wallgrove Rd.

The industrial premises are leased out by Brighton-Best International which operates 31 stocking warehouses worldwide supplying socket screw products.

The 5994sq m Smithfield site has a mix of offices and warehouses in an industrial duplex totalling 3700sq m.

Mr Bishop said the portfolio was highly sought after due to its weighting to Sydney, as the city was the top destination for new capital coming into the Australian market.

“Over the past five years, just 42 assets on average were brought to market each year in Sydney, which is under the 47 assets recorded for Melbourne and 45 assets for Brisbane over the same period,” he said.

At a current vacancy rate of only 0.2 per cent, Sydney is Australia’s tightest market compared to the national average of 0.7 per cent.

Originally published as Billionaire Bob Ell offloads three Sydney industrial sites