WAC steps up commercial tenancy drive

WESTRALIA Airports Corporation’s master plan to integrate the domestic and international airports into an industrial and commercial precinct has taken off.

In the past three years, the WAC has developed 65ha of land surrounding the two terminals, boosted its rent-roll to more than $45 million and attracted major tenants to the budding estate, such as Cummins Engine Company, Fowles Auction Group and WDM International.

The master plan to develop the 700ha of airport land has been dubbed Vision 2018 and WAC Property and Development general manager Andrew Whiteside said it had proved a success to date.

The land is divided into seven precincts, which will cater for a range of uses including commercial, industrial, warehouse and short-stay accommodation.

WAC plans to develop the land primarily through design and construct, or leaseback, deals.

“We prefer to do leaseback deals but at the end of the day some companies like to build and own their buildings, so if they suit our aims and add value to the area, we will try and accommodate that,” Mr Whiteside said.

“When we put together a leaseback deal we like to have longer leases, about 10-years.

“And because we compete on the open market our rents are comparable to those you would find in the nearby Kewdale, Welshpool and Forrestfield areas.”

Prime industrial warehouse rents sit at between $50 and $65 per square metre in Kewdale and between $45 and $60 in Welshpool.

One of the most recent leaseback deals the WAC has undertaken involves Cummins Engine Company. Under the deal, WAC will build an 8000sqm regional headquarters for the company that includes administration, engine rebuild facilities, a truck service workshop, warehouse and parking for more than 100 cars.

Star Track Express is one company that will construct its own premise under a leasehold agreement with the WAC.

The $9 million freight facility will be modelled on the company’s $55 million facility at Minchinbury, Sydney, and is expected to complement the existing, and planned, freight-associated comp-anies at the airport.

Mr Whiteside said WAC planned to manage the land carefully, so it developed into a structured and integrated estate filled with business that complemented one another.

“To this end we are not actively marketing the estate, we don’t want just any company,” Mr Whiteside said. “We are conducting very targeted campaigns, we will almost be hand picking our tenants.”

Companies involved in transport and logistics, manufacturing, storage, telecommunications and technology were likely to be suitable anchor tenants, Mr Whiteside said, however other companies that provided amenities and services to

hese tenants also would be welcomed.

Colliers Jardine industrial director Craig Robertson said the land would be best suited to those companies that complemented the business of the airport, such as transport and distribution, however companies with staff that had to travel regularly also may consider relocating to the airport.

Knight Frank commercial and industrial director Martin Reeson said the airport precinct was likely to emerge as the most significant business and industrial area over the next two decades.

“The airport will become a key node for warehousing and distribution activities in Perth, given its air cargo facilities and the significant road links that radiate from the airport,” Mr Reeson said.

“The airport location also provides further benefits to companies including air side, security, 24 hour access and operation, conference facilities ... and, of prime significance, the opportunity to develop on greenfields sites which will allow maximum flexibility for future expansion.”

It also was likely there would be movement of major companies from areas such as Kewdale and Welshpool and to the airport precinct as their existing complexes became dated and obsolete, Mr Reeson said.

City of Belmont business development manager Peter Schifferli agreed there would be a ‘natural migration’ of businesses from established industrial suburbs to the new precinct, but said areas such as Kewdale and Welshpool would always remain popular.

“I believe (companies relocating to the airport) is already happening because companies are growing out of their existing premises and moving to the airport where the space is available,” Mr Schifferli said. “The airport presents incredible opportunities but people will always want to get into Kewdale and Welsh-pool, especially those companies that will provide some kind of service to companies at the airport.”