
Mark Cadman, Artie Kalpidis, Jeff Pond and Matt Herrett of Link Property Services
Three years ago, four key Australian directors of multinational giant Jones Lang Lasalle, left the corporate world and set up boutique industrial firm Link Property Services.
Swiftly agile with a focus on intense personalised service, the partnership has over 90 years of real estate experience between them. Their expertise spans leasing, vacant possession & investment sales, site acquisition and project marketing. With an astounding annual growth rate of 40% and a client list spanning the who’s who of listed and private property groups, it’s easy to see why the firm’s “actions speak louder than words” approach has earned such a high level of respect in the industry among both clients and competitors. Quiet achievers; Mark Cadman, Artie Kalpidis, Jeff Pond and Matt Herrett, Joint Partners of Link Property Services talk Industrial property, yields, cost of capital and their recent $32 million sale to Fife Capital Group.
MP: As a new business, Link is achieving results beyond its years. It’s an impressive achievement to set up a business in the economic environment that you did. What was the rationale behind such a significant move and to what do you attribute your results?
Mark: With the drivers in the market shifting substantially and our client’s requirements changing as a result, we collectively saw an opportunity to provide a much higher level of personalised service at a more effective level.
As an independent group we’re not constrained by time consuming administrative and management responsibilities. As a result, our sole focus is the most important person in property – our client.
We are very passionate about property and have a lot of fun in the process of what we do. This combination provides the opportunity to achieve great results.
MP: Link has generated significant client loyalty. Why do you think this is?
Matt: We are consistently driving results for our clients, which earns loyalty. Campbell Arnotts acquired the Players Biscuit business and chose to decommission its biscuit manufacturing businesses in Sydney. The site was sold to a developer, Altis Taren Point Pty Ltd, and together we repositioned the property. Altis engaged us to sell the repositioned asset. Lot 1 sold to BMW for $3.5 million; Lot 2 sold to North Shore Timber for $3.5 million and Lot 31 sold to Savwill Pty Ltd for $1.36 million.
MP: Link recently completed a turnkey for GME at Australand’s site in Winston Hills. Can you give some further detail on this deal?
Jeff: Electronics Company GME had occupied various buildings in the Gladesville area for over two decades. The group wished to consolidate all of their operations into a new state of the art Head Office facility. Link assisted GME in conducting a comprehensive property search and based on price; location, flexibility and accessibility negotiated the completion of a turnkey at Australand’s Northlink Business Centre, over two buildings totalling 16,000sqm. The construction works were completed in February this year.
MP: Link was responsible for Costco securing their facility in Huntingwood. What were their key drivers?
Jeff: Costco had appointed a corporate global agency to locate their east coast distribution centre. After months of fruitless searching Costco contacted us and we assisted them to source, negotiate and secure their 25,000sqm facility, again with Australand, in Huntingwood. The facility was larger than Costco’s Initial requirements however one of the key drivers of the deal was that it enabled valuable expansion room as their outlet numbers grow.
MP: 25 Nyrang Street, Lidcombe was another great transaction Link completed. Can you give the headline terms on this deal?
Mark: Complete Office Solutions (COS) had recently purchased several office/warehouse premises interstate. They required a 10,000 sqm facility in Sydney and after 6 months of searching they contacted us. We re-qualified their requirement and were appointed exclusively to locate a suitable property to purchase. We identified a 2.8-hectare redevelopment site in Nyrang Street, Lidcombe that was ideal. We negotiated the site acquisition for $12.25million as well as introduced the builder to COS, who was awarded the contract to construct approximately 17,000 sqm of first class office and warehouse space.
MP: What trends are you seeing in the market?
Matt: We have hit the bottom of the market and the upswing is evident as enquiry profile is changing from tenant to owner-occupier. Tenants with significant lease tail remaining are seeking acquisition opportunities. We received an enquiry last week from a national group looking to buy a generic warehouse. They are located in Melbourne, Brisbane and have a budget of $17-20 million for Sydney.
Acquisition activity is also strong from developers looking to reposition assets for upside.
We have recently listed 1 Inglis Road, Ingleburn for sale via EOI, with a site area of 65,960sqm and warehouse building area of 9,928 sqm. The lease to Clipsal Australia ends in December this year. The site has DA approval for an additional 21,280sqm office warehouse and has excellent access to the M5 and M7 motorways. We have experienced strong enquiry from the investor, developer and owner-occupier markets for this property. The low cost of capital is feeding through to the buyer market.
We are also seeing a renewed activity from fund managers given the spread between the cost of capital and industrial yields.
Mark: 53 Britton Street, Smithfield is coming to the market via an EOI campaign. It has a site area of 36,830 sqm, an office warehouse building of 13,484 sqm, which has been constructed to a very high standard. The annual net rental is $1,816,802 per annum with an excellent rental review structure. We are confident we will attract a high level of interest from private investors and syndicators in particular.
MP: What sort of Receiver sales activity has Link been involved in recently?
Artie: We were appointed by the mortgagee, Perpetual Nominees Ltd to sell 260 Captain Cook Drive, Kurnell, an approximately 11-hectare industrial site, which we sold for $6.11 million. We are also currently negotiating as exclusive agents on the sale of 238 Captain Cook Drive, Kurnell, on behalf of a Receiver and Manager. The site consists of around 17,000 sqm of older style buildings on a site of approximately 17ha.
MP: Are you seeing much offshore money coming into the local market?
Matt: We have recently completed another receiver sale to a cash buyer, an owner-occupier based out of China. The site was 35,000sqm with a 15,000sqm older style building. They transacted very quickly and illustrated the willingness of overseas groups to purchase once the right property is located.
MP: Can you give the headline terms of your recent $32 million sale to Fife Capital Group?
Mark: Our client was a not-for-profit organisation. The sale settled last week and reflected a yield of approximately 10%. The acquisition strategy is a long-term passive hold to capitalise on yield compression and the spread between the cost of capital and the income. The tenant is Symbion Pharmacy Services, with an expiry of March 2018. 55 Kirby Street, Rydalmere has a site area of 35,370sqm, with a 21,955sqm temperature controlled warehouse, plus a 2,502sqm office. The building presents extremely well.
For further details contact Link Property Services Western Sydney Office on 02 8753 7333, or South Sydney on 02 8338 8053
