Centuria Puts Olympic Park Office Building to Market
31 October 2016
Centuria has put its A Grade office building located at 8 Australia Avenue, Sydney Olympic Park on the market as Sydney’s metropolitan office markets, in the midst of historically low vacancies, an unprecedented level of stock withdrawals, and increasing tenant demand, offer compelling metrics to a hungry investment market.
Savills Managing Director (NSW) Simon Fenn, who is managing the sale with colleagues Graeme Russell and Matthew Dunn in conjunction with CI Australia’s Bevan Kenny and Michael Stokes, declined to put a price on the asset however the building has a passing net income of more than $3.1 million from a diverse tenancy profile including Simplot, Watpac, Western Sydney University and Fujitsu.
Mr Fenn said withdrawals, currently making way for mixed use/residential development and new transport infrastructure, and strong tenant demand, had resulted in substantial growth in net effective rents of around 7 percent over the last 12 months across several suburban markets including Parramatta, Macquarie Park, Olympic Park and Rhodes.
He said with Parramatta’s market at a tight circa 4.5 percent and the average across Sydney’s five largest suburban markets at an even lower 3.7 percent, the demand for metropolitan markets and especially well connected markets such as Sydney Olympic Park and Rhodes, was inevitably going to grow, and grow substantially.
“The fact is that we currently have very low vacancy, and in some cases historically low vacancy, in Sydney’s suburban markets, and with withdrawals and increasing demand that’s not going to abate any time soon. Given that scenario the demand has to go somewhere and it’s boutique markets like Sydney Olympic Park and Rhodes that are right in the cross hairs.”
Mr Kenny said additionally that the State Government’s Master Plan for Olympic Park to transform the precinct into a $10 billion mini-city with a population of approximately 20,000 and 34,000 jobs, would include 100,000 square metres of retail space, several 45-level residential towers, a new light rail link between Parramatta and Strathfield, new bus services to Rhodes, an off ramp from the M4 and schools.
He said Centuria’s decision to put the 6,555 square metre property on the market underscored the precinct’s potential and its appeal to investors.
“Centuria has astutely assessed the overall market trends, along with the Government’s Masterplan, and deduced that strong tenant demand is going to drive rents and values in this market and that sort of growth potential upside is exactly what investors look for.”
Completed in 2010, 8 Australia Avenue provides four ground floor retail tenancies, five upper levels of office accommodation and two levels of basement parking for 121 car spaces. The property has a 5 Star NABERS Energy Rating and a WALE of 3.87 years as at 1 January 2017.
The property will be offered by Expressions of Interest campaign closing 4pm (AEST) Wednesday 9 November 2016. The sale will require the approval of unitholders in the Centuria-managed fund that owns the building.
