Bob Ell cashes in with $67m Sydney Airport industrial sale
Billionaire property investor and developer Bob Ell has walked away with another substantial capital gain on a shrewd industrial play after selling a 1.37ha logistics estate near Sydney Airport to new entrant Pittwater Industrial for $66.75 million.
Mr Ell’s Leda Holdings paid $48 million for the 247 King Street property in Mascot in October 2019 – home to nine office and warehouse buildings over two levels – when he bought it off receivers following the collapse of ready-to-eat meal producer Jewel Fine Foods, whose owners the Matta family held the property.
The sale to Pittwater Industrial represented a 39 per cent capital gain in less than three years.
Mascot lies within the sought-after South Sydney industrial precinct, which has virtually zero vacancy given its prime last-mile delivery location and due to competition for sites from residential developers.
South Sydney is also at the epicentre of Australia’s emerging multi-storey industrial development market with the likes of Goodman Group and Logos (which bought the huge Qantas Mascot site last year) planning such projects, which can command rental premiums of up to $400 a square metre.
While Pittwater Industrial did not respond to a request for comment, selling agents Colliers said the new owners would develop a multi-level warehouse facility upon the Mascot land holding.
According to its website, Pittwater is focused on the “long-term ownership and management of high quality, well located industrial space ranging from metropolitan last-mile facilities to large-scale distribution centres”.
The Mascot sale is yet another industrial divestment that has yielded handsome returns to Mr Ell – worth $2.4 billion according to the 2022 Financial Review Rich List.
In 2020, the veteran developer made a 54 per cent capital gain in three years on a Western Sydney industrial property he sold to fund manager EG for $38.2 million.
In 2018, he made yet another tidy profit – an 18 per cent capital gain in less than a year – after selling a vacant warehouse in western Sydney for $18.13 million to an international pharmaceutical group.
The Mascot estate was one of the three Sydney properties that Leda Holdings sold to Pittwater Industrial for a combined $95 million. The others were warehouses at 87-91 Victoria Street in Smithfield ($13 million) and a warehouse and office facility at 6 Shale Place in Eastern Creek ($15.25 million).
Pittwater Industrial is backed by an unnamed institutional investor and led by former Urbanest directors Ted Hawkins and Dave Munro.
The company, which was only set up in July last year, has already made some big property plays, including setting a new low yield benchmark of 3.35 per cent for industrial real estate in Australia.
This related to its $58.3 million purchase in March of a 15,066 square metre warehouse in Prestons in Sydney’s west leased to container logistics operator ACFS.
The Leda portfolio was sold by Colliers agents Gavin Bishop, Sean Thomson, Trent Gallagher and Paul McGlynn.
“The Portfolio was highly sought after due to its 100 per cent weighting to Sydney, considered Australia’s strongest and most tightly held industrial investment market, reflective of favourable fundamentals and a lack of turnover from institutional groups,” Mr Bishop said.
“Sydney represents the number one destination for new capital looking to be deployed in the Australian market, underpinned by its global gateway status, being Australia’s largest urban centre.
“Over the past five years, just 42 assets on average were brought to market each year in Sydney, which is under the 47 assets recorded for Melbourne and 45 assets for Brisbane over the same period”
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