The GPT Group have announced the completion of a super-sized warehouse in Western Sydney, making it one of the state’s largest logistics distribution facilities delivered this year.
Located at 128 Andrews Road, Penrith, the 50,150 square metre facility was designed and built for glass manufacturer and distributor Owens-Illinois Inc. (NYSE: O-I), whose Australasian arm since been acquired by Visy.
The GPT Group acquired the asset from Cadence Property Group on a forward-funded basis last year, with Visy now taking occupancy under a 10-year lease arrangement.
The facility was built by design and construct builder Texco Construction in 10 months, and is located next door to the now Visy-operated glass manufacturing plant, providing direct product transfers to its warehouse resulting in cost, timing and quality efficiencies.
Matthew Faddy, Head of Office & Logistics at GPT said: “GPT are pleased to deliver on another well-located logistics development in the highly-desirable Western Sydney market. The Group remain focused on successfully unlocking our existing development opportunities, with our pipeline of developments underway and planned totalling approximately $1 billion, including our 33-hectare site at Kemps Creek which recently achieved rezoning.”
The acquisition complements GPT’s existing holdings in Western Sydney, including a 17,000sqm speculative development currently underway at Glendenning and a 5,000sqm facility recently completed at Yennora, activating surplus land on a five-year lease. At its interim result last month, GPT announced the value of its logistics portfolio had increased in the first half of the year to $2.6 billion, growing by 8% from December 2019.
Cadence Managing Director Charlie Buxton said: “The completion of this asset is significant not only for its size but in its role of supporting one of the major manufacturers and employers in western Sydney. Our team of specialists integrated a range of custom design solutions into the new facility to maximise operational efficiency and reduce running costs. It’s a project that sets a new benchmark for industrial warehousing in Western Sydney’s growth corridor.”
Demand for high quality industrial assets has remained strong in 2020, Mr Buxton said, with prices holding up, or in some instances increasing, for long-term let logistics facilities leased to strong covenants. Demand from both tenants and owner-occupiers for a range of industrial uses has remained relatively robust during COVID-19, particularly for operators seeking to further enhance their supply chain efficiencies.
“We’ve long recognised the need and urgency around supply chain efficiency and continue to look for opportunities to assist businesses in realising these benefits as has been achieved in Penrith with Visy,” Mr Buxton says.
CBRE Commercial’s Trevor O’Grady, who brokered the deal, said the completion of the Visy warehouse at 128 Andrews Road, Penrith, signalled bullish confidence in logistics and manufacturing in Australia. The new facility fosters greater sustainability, while improving operational efficiencies and reducing transfer costs.
“With an increasing focus from clients on controlling their total costs, real estate decisions are increasingly being informed by analysis of the total supply chain network,” Mr O’Grady said.
“This transaction outcome delivers Visy significant savings from both a real estate and transport cost perspective.”