2020 was a year like no other. But we are proud to have shown a strong resilience, whilst also reaching a number of noteworthy milestones. Progress at both stable and development sites in growing corridors and established markets have set us up to service many of our valued customers and to be in prime position to capitalise on major infrastructure projects and growth opportunities.
In the midst of the global pandemic, Stockland continued to expand its Workplace and Logistics development pipeline, a strengthening of the resolve of our strategy to grow this area of the business to represent a third of the total portfolio. Our growth in the last twelve months was driven by a vision for the future of work and life in Australia long beyond COVID-19.
Much of our recent activity has centred around the eastern seaboard states. In western Sydney, transport and logistics giant Linfox leased over 54,000 square metres of GLA at our Forrester Distribution Centre in St. Mary’s. Toll Transport secured over 11,000 square metres of prime industrial GLA at Stockland’s Yennora Distribution Centre. To the south, Stockland’s eleven-hectare estate at Warwick Farm, Coopers Paddock, was presented with the Property Council of Australia’s Award for Best Business or Industrial Park. And close to what has become the city’s peripheral ring road, we acquired a development site on Bringelly Road at Leppington with an end asset value estimated at over $145 million in FY24 under Stockland’s current proposed scheme.
Significantly, all four sites service the burgeoning Greater Western Sydney via the region’s motorway network, highlighting the strategic thinking behind Stockland industrial site location.
The launching of our Gregory Hills Industrial Estate land subdivision has been met with strong user demand, with only four lots remaining at the year’s end. We also made great strides forward in the workplace arena. A planning proposal was lodged in August for the Piccadilly office redevelopment, and we are nearing completion of planning and development documentation for our existing building at 110 Walker, as well as its adjacent sites in North Sydney.
Our strategy has also been progressed meaningfully in Melbourne. Australia’s largest electronics retailer JB HiFi secured 18,000 square metres for its store and home bulky items distribution at Stockland’s new KeyWest Distribution Centre at Truganina in Melbourne’s west. Refurbishments at stable assets saw Brooklyn Distribution Centre, Mulgrave Corporate Park and others refreshed and ready to meet future customer requirements.
Stage 1 infrastructure works commenced onsite at Melbourne Business Park, with significant interest building from prospective users and tenants. With an estimated $2 billion end value once fully developed, the 260 hectare logistics and business project is set to become one of the largest and most significant in Melbourne’s fast growing western suburbs.
Similarly, in Queensland, we completed stage two of the $70 million Yatala Distribution Centre, once best known for its boutique pie shop and now, an essential waypoint on the all-important Brisbane-Gold Coast corridor. Three new 10 year leases were secured at the site by local operators. Stage two of the Willawong Distribution Centre, west of Brisbane, was also completed ahead of schedule.
Working in partnership with key customers has always been integral to the Stockland strategy. Stockland has entered into a put and call option deed with Johnson & Johnson Medical Pty Ltd to acquire the healthcare company’s 1 – 5 Khartoum Rd, Macquarie Park office building site.
Stockland and the Johnson & Johnson Family of Companies in Australia have also committed to working towards an agreement to design and deliver a new 10,000sqm head office for Johnson & Johnson in Macquarie Park, which will bring together the company’s 820 office based employees from across Sydney. For Stockland, the J&J deal dovetails with its major Macquarie Park workplace development, contributing to the growth of the thriving precinct.
In a year largely defined by COVID-19, there was also the need to ensure we remained agile in our approach and response to the challenges posed. A partnership dynamic was maintained by working alongside customers to ensure they were kept informed and, most importantly, safe in our assets.
We worked closely with government and stakeholders at all levels to ensure our customers were engaged on the good faith principles contained within the commercial Code of Conduct, recognising the financial disruption caused by the pandemic.
A suite of hygiene messages and social distancing signage was rolled out, while asset cleaning schedules were increased. At a national level, an action plan was developed to address confirmed cases should they arise, and preventative advice was distributed to customers. We also contributed to the range of COVID-19 testing options, joining forces with customers at our Macquarie Park assets to open dedicated clinics.
Stockland’s Space to Thrive philosophy has never been more relevant. With an open, energetic and future facing outlook, it defines our commitment to helping organisations succeed. It’s about challenging outdated ways of doing things and partnering with people and organisations to give them space to thrive in thoughtful and adaptable environments.
In a year like no other, in which milestones were reached, existing relationships strengthened and new ones forged, a solid foundation has been laid to embed this philosophy into the new year and beyond.