An acute shortage of industrial & logistics land in Sydney’s outer northwest, where vacancy was just 0.2% – the tightest globally – has given rise to the launch of a $2 billion Nepean Business Park (the park) at Penrith.

Occupying a 49-hectare former quarry site adjacent to the Sydney International Regatta Centre, the park is expected to be the first small lot subdivision of this scale to be developed in Sydney for over 15 years.

Unlike Sydney’s industrial market, which is predominantly controlled by institutions that develop to hold long-term – and typically focus on larger buildings above 4,000 sqm – the park is expected to deliver around 93 small to medium lots that are in serious undersupply across Sydney’s highly constrained industrial market.

With smaller lot sizes ranging from 2,007 sqm, the park is expected to attract strong interest from owner-occupiers.

In addition to attracting an influx of small businesses looking to own their own premises, CBRE’s John Micallef expects the park to attract investors, especially given the market’s strong underlying fundamentals.

For example, to cater for an additional 800,000 people expected to be living in Sydney between now and 2031, CBRE expects demand for around 3.6 million sqm of industrial and logistics floor space over this period.

Micallef and Matthew Alessi together with Macquarie Commercial’s Luke Belotti have been appointed to steer the Stage 1 launch on behalf of Australian-owned private family investment office Precinct Capital.

“There is clear demand for this style of industrial and warehouse space, with the Penrith area fast becoming an employment hub for major industry and suppliers,” said Precinct Capital Chairman Bruce Baudinet.

It’s understood that lots within the Nepean Business Park site will feature open space, public art and benefit from pedestrian and cycle links.