Wisetech Cashes in Sydney HQ

Rich-lister and founder of software company Wisetech Global, Richard White, is selling his company headquarters in Alexandria, in Sydney’s south.

White, who is worth $3.31 billion, bought the 70-74 O’Riordan Street property for $12 million four years ago before spending more than $14 million converting the space into modern offices to house ASX-listed Wisetech.

Wisetech, which provides software services for global logistics industry, picked up the property shortly after raising $167.6 million from new investors and listing on the Australian Securities Exchange.

White said the refurbished former warehouse reflected the 25-year-old company’s expansion, holding a net lettable area of about 3,850sq m in Sydney’s rapidly growing fringe CBD office market.

“From the start, I wanted to create a state-of-the-art expansion of Wisetech’s already considerable presence at the location.

“The building was designed and built with much care and attention and complements the existing Wisetech tenancy and data centre assets that reside within the Wisetech O’Riordan Street compound.

“The staff and customers love it,” White said.

The move by Wisetech comes as part of a commitment to cease doing private business with his public company by the end 2021.

Wisetech pipped expectations for financial year, reporting a 23 per cent lift in revenue to $429.4 million for the year to June.

The tech firm told the market it was expecting revenue growth of 9 to 19 per cent which translates to revenue of $470 million to $510 million heading into 2021.

The property is being marketed by Colliers International and Karbon Property as a sale-and-leaseback deal with Wisetech as the major tenant on a five-year lease.

Colliers International national director of property sales and leasing Michael Crombie is anticipating prices of circa $35 million, representing a 6 per cent yield.

“Covid-19 has actually had a positive impact on commercial metro office markets, especially Alexandria and Mascot, in fact we have seen more large commercial lease enquiry in 2020 than we did in all of 2019,” Crombie said.

“We anticipate a non-aggressive yield and superior covenant in Alexandria’s most premiere street to appeal to prospective buyers.”

Over recent year’s developers and tenants have looked to offices in booming Alexandria as vacancies for Grade A offices fell in the central business district.

Many fringe and suburban markets have seen rents grow by 25 to 30 per cent in the past three to four years, off the near 50 per cent growth in CBD rents.

“Buyers are being drawn to South Sydney for its affordability [at] $500-$750 per square metre,” Crombie said.

“There are incredible pre-lease opportunities which are all Covid-safe, car parking ratios, public amenity and the style of buildings in Alexandria—walk up as opposed to using a lift.”

Nearby, veteran Sydney developer Theo Onisforou has a stage two development application in front of council for a 10,000sq m A-grade office building.

The campus-style project at 290-294 Botany Road will feature hygiene-centric amenities such as opening windows and automatic doors throughout and a disinfectant room.