Sydney’s burgeoning e-commerce sector is behind a push for premium office space in a traditionally industrial pocket of Sydney’s west, with the offices in one warehouse development of similar quality to those in the Sydney CBD.
Industrial estates are often associated with vast swathes of steel and concrete, with little in the way of creature comforts.
Often the only office you’re likely to find is a cramped corner affair – squeezed up on a mezzanine level and usually reserved for a few filing cabinets and the odd meeting with human resources.
But times are changing, with the rapid growth of e-commerce giants largely responsible, according to Mirvac.
The company recently launched a new industrial estate – Calibre – offering office space “equivalent to CBD A-grade stock” that was inspired by its extensive residential experience.
“Mirvac is passionate about quality and legacy when it comes to development. [Calibre was an] opportunity to draw on an integrated model and draw on commercial and residential knowledge and create a state-of-the-art premium logistics facility,” said Mirvac’s general manager, industrial, Richard Seddon.
The 22-hectare site, which includes a mix of flexible warehousing and office space, was publicly unveiled last week.
The demand for A-grade office space in the Eastern Creek area was strong, said Mr Seddon, with new operators demanding the same kind of facilities they would expect in areas such as the Sydney CBD or Parramatta.
“It’s complementary to their needs and it’s what customers wanted,” he said, adding “[It’s an] A-grade CBD asset equivalent office”.
The architecturally designed offices include end-of-trip facilities for bicycle commuters and an onsite cafe (planned for operation from mid-2019).
Demand for such assets was largely driven by the growth of e-commerce and related businesses.
“Thirty-five per cent of our customer base has originated from some sort of e-commerce use, [which is] symptomatic of the wider trend for e-commerce and the resulting demand for industrial areas,” Mr Seddon said.
He said that demand in the Eastern Creek area, which is 35 kilometres west of Sydney, originates from three “buckets” of industrial operators.
“There’s a lot of e-commerce work that’s done by third party logistics companies, also pure play companies, people like Amazon and retailers who are expanding into this space. Coles and Woolies are expanding their online presence, even companies like IKEA are expanding online as well.”
Calibre was fully leased prior to completion with tenants including CEVA Logistics, Miele, Pet Circle, Sheldon & Hammond and ACFS e-Solutions.
Supply chain director at Pet Circle Nick Bennett said that the company had restructured its recruitment practices following the decision to lease space at Calibre.
“After seeing the high-quality workspace and amenity of the facility, it allowed us the flexibility to have employees based here that are not traditionally warehouse employees, such as a customer-service team. The recruitment drive post move allowed us to hire the majority of workers from the western Sydney area.”
Eastern Creek was particularly popular with these operators because of its close proximity to Sydney’s freeway network.
“Eastern Creek is part of the broader western Sydney employment area which has seen significant growth since earlier 2000s and the completion of the M7. Proximity to the M4 and M5 drive demand… The estate is located directly adjacent to the M4/M7 junction and has superb access to motorways going into metro area.”
With constant speculation surrounding automation’s potentially transformative effect on the industrial sector, the warehouse components have been designed to be “future friendly”.
“The entire estate has been designed to be future friendly and flexible,” Mr Seddon said, adding “we expect that the adoption of automation is likely to continue as tech becomes more readily understood as tech becomes more affordable.”
Each of the estate’s warehouses has been designed with the ability to split each building into separate tenancies with separate access.
Environmental considerations include rainwater harvesting, smart metering and photovoltaic solar.
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