Frasers Property Industrial and Altis Real Estate Trust will develop 118 hectares of industrial land at the Mamre Road Precinct in Western Sydney, marking the first joint venture for the pair.
The new estate will accommodate up to 400,000sq m of logistics and industrial facilities, which the duo say will have an end value of circa the $1 billion mark when finished.
The transaction involved the purchase and amalgamation of several sites in the popular western Sydney precinct from private owners, spanning properties from 649 to 763 Mamre Road.
The joint venture team said the Mamre Road buy was identified a number of years ago as a potential industrial development site.
“Its strategic location between the traditional industrial areas of Eastern Creek and Erskine Park and the emerging Western Sydney International Airport precinct made it an ideal region to expand in,” Frasers Property Industrial general manager Ian Barter said.
Singapore-backed Frasers has developed industrial estates including parcels in Eastern Creek, Horsley Park and Wetherill Park, while Sydney-based fund manager Altis Property Partners’ recent local projects include the First Estate Kemps Creek and Bankstown Airport.
The Mamre Road precinct spans 850 hectares and is one of 10 key precincts in the Western Sydney Aerotropolis.
It was officially rezoned by the New South Wales government in June following the state government’s green-light in May as part of a fast-track announcement.
Mirvac has plans for its own 56-hectare industrial estate within the Mamre Road Precinct, known as Aspect Industrial.
The listed developer secured the Badgerys Creek site for $71 million in late 2018.
On the latest land purchase, Barter said the industrial sector had continued to perform throughout the pandemic.
“The critical nature of the industrial and logistics sector has been highlighted during the Covid-19 period,” he said.
“The industrial sector continues to go from strength to strength and this development will provide a huge boost to economic activity within the region and serve as a critical employment hub for Western Sydney.”
Due to demand for industrial assets, Moody’s Investors Service said a shortage of quality industrial assets on the eastern seaboard capital cities of Sydney, Melbourne, Brisbane would likely continue as demand outstrips supply.
“Demand will accelerate over the next several years, supporting occupancy and rental growth, particularly in Sydney because of solid economic fundamentals, lack of supply and geographic limitations,” Moody’s vice president Saranga Ranasinghe said.