Prime Sydney Bunnings site sold for $70m in off-market acquisition
Two Australian corporate luminaries – corporate adviser Simon Mordant and board room legend David Gonski – have emerged as among the biggest beneficiaries of the switch to home delivery.
A Bunnings Warehouse their interests had valued in the inner Sydney suburb of Alexandria for about $16m in 2015 has just sold to an arm of the acquisitive Charter Hall empire for $70m. They had owned it since 2003 when it was occupied by a smaller hardware chain that Bunnings later acquired.
The pair, alongside former Allianz Australian chairman John Curtis, are directors of South Central Sydney Pty Ltd, which bought up the property for $16m.
Council documents show that some minor works were approved for the complex when they owned it but the real benefit came from buying at a time when the Bunnings lease appeared short and the industrial property boom was yet to kick into gear.
There is now a fierce war for sites that can be turned over to last mile delivery stations as more consumers switch online and once Bunnings shifts out in about four years the complex is likely to be repurposed.
The property at 520-530 Gardeners Road was bought by the Charter Hall managed Core Logistics Partnership. It is in the tightly held prime South Sydney precinct and the deal was brokered via an off-market acquisition brokered by Joshua Charles of One Commercial.
The 1.9ha site in the tightly held Alexandria industrial and logistics precinct will spin off an income for the remaining lease term of four years before likely being redeveloped.
A Bunnings Warehouse store has been on the site for 20 years, however Charter Hall has negotiated a surrender package with Bunnings who no longer need the facility.
The property on the corner of Gardeners Road and Bourke Road is near Sydney Airport and Port Botany. It is also close to the St Peter’s Westconnex Interchange which, when opened in 2023, will link Sydney’s two major freeway’s – the M4 and M5.
The area’s gentrification with large parcels of land being rezoned from industrial to high density residential and mixed use is creating a shortage of well-located industrial and commercial land.
CLP fund manager Simon Greig, said the property had excellent redevelopment options including the ability to develop a high-profile logistics or last mile facility under the current zoning.
“South Sydney is one of the most sought-after industrial precincts in Australia given the access to major transport hubs, the Sydney CBD, port, airport and surrounding densified residential precincts,” he said.
Charter Hall CEO David Harrison said the company’s relationship with Bunnings had allowed it to access the high profile corner site with multiple development options.
“We now own an industrial and logistics portfolio exceeding $11 billion leased to more than 140 tenant customers,” he said.
This article originally appeared on www.theaustralian.com.au/property.