Is there any effect if one big company is replaced with multiple smaller company to take over the place there in Parramatta ? @WinDyz. what do you think ?
The rental market in Parramatta is mainly driven by IT workers on 457 visas. It looks like less contracts are being issued which could be a reason why vacancy rates hit 3% already in September and is much higher than usual. From my experience, lots of stock is leased around the Sep/Oct period so the vacancy rate may even go up to 3.5% in December. The past years have been positive but too much reliance on temporary workers and new supply coming on could mean more vacancy and rent reductions in the future.
Hi @Tekoz. The question is, will they be able to attract the quality multiple smaller companies in? That won't be easy unless Parramatta council works really hard to drive business to the area. Plus they are doing something like an 80 level commercial building so Parramatta has a lot space to fill. I know there are heaps of new apartments going into the area. Still needs additional demand to fill it to absorb any oversupply. Maybe Parramatta's focus on tertiary education will become more prominent as employment drops....
@Nick Valsamis I wonder how do you know about that information mate ? I couldn't find that information from free property research engine / website.
@Gockie yes you are right. But if they agreed to lower the price down I guess they won't have any issue for finding tenants.
You can find it on SQM for free. SQM Research With the chart, it actually says 2.6% now but the numbers given for properties should be higher which is why it's probably really at 3%. The high amount of properties on the market isn't because of any new developments right now, it's all existing stock that cannot be leased fast enough. Considering the recent change in the marekt, I think the vacancy rates for Parramatta won't go below 2% anymore.
Maybe he has concerns prices would flat line or go backwards and there may not be any growth for a number of years , and he wants to buy some where that will have growth in that medium time frame . Just a thought ... After the last boom , the forum had stories of OTP's coming in below purchase price and not having funds to settle .. I've been hearing stories about how parramatta is going to change for over 30 years and it's still parramatta . Cliff
Personally I dont find investing within Parra that attractive, mainly due to supply (ie high rises). However wouldnt mind land in areas like auburn/granville/guildford/merryland. 2013 was a good time to buy with prices now nearly doubled. However with the downturn there may be some opportunities next year or 2.
Another milestone in the development of Parramatta, now focused on the Cumberland hospital/female factory heritage area in the north being rezoned for gentrification and construction of new apartments. State Government approves rezoning proposal for Parramatta North Urban Transformation "A MASSIVE residential and commercial development in North Parramatta is one step closer to construction after an application to rezone the area was given the green light. The Department of Planning and Environment has approved UrbanGrowth NSW’s application to rezone the Cumberland East Health Precinct, marking the start of the Parramatta North Urban Transformation Program." No Cookies | dailytelegraph.com.au
CBA didn't move from Parra due to not liking the area, their leases for all offices were due for renewal and the powers that be at Redfern Technology Park made them a better deal to move pretty much everyone there. I'm sure there are lots of upset employees right now. We moved from the east to the west when they told the majority of their CBD staff that if they wanted to keep their jobs they would be heading to Olympic Park. The only thing holding back more business moving to Parra are the company executives who don't want to lower themselves to work out here. So the companies stay put in the city.
As much as I like working in Parramatta I like the announcement of the move to ATP... (I may not be working there in 4-5 years' time but plenty of staff have been there for very long tenures). But in addition, I wouldn't like working at SOP all the time and I think it also puts potential employees off. You have to go to Strathfield and then get a shuttle bus or catch the train to SOP itself which I don't find convienent. Plus CBA runs a shuttle bus between campuses and that takes time (and money for CBA) so if you have to go visit another location you need to spend a lot of time in the transport. I have a colleague who recently bought land out at Jordan Springs near Penrith and only soon to start the build... I think if he still is at CBA in 4-5 years' time he and his family should probably move back into their unit at Arncliffe (with the $1300 quarterly strata fees!!)... even if they have a child... and they will be having this 1st kid very soon.... I reckon they wont stop at 1 kid either as they are Chinese of the 1 child policy generation...
What do you mean by 'lower" ? is it because of the transportation issue going to the West during peak hours. I believe that with many development of the office space, there will be commercial rent price adjustment which will be more attractive when those office buildings completely built and empty.
Tekoz Parramatta isn't considered as nice as the CBD , and having spent time in both I'd agree. Most of the CEO's will live eastern suburbs , north shore and the CBD is closer and it's where their friends work as well , it has the exclusive clubs and nice restaurants and the CEO's make the decisions ..... PWC along with other high end firms are moving to Barangaroo , not parramatta . Cliff
Ah I see, I've never thought about that since I'm not a CEO that does make sense. I have seen only CBA news not the PWC moving to Barangaroo, as at now it is still on the Darling Harbour tower same with Rabobank. Many thanks for the clarification.
Westpac are also moving a lot of their workers to Barangaroo . They do have one section in Parramatta ...... Risk and Fraud Cliff
Knight Frank's view on the CBA move and its effect long term. No slowing down for Sydney’s western leasing market "Even the news that the Commonwealth Bank of Australia (CBA) will be relocating to the Australian Technology Park (ATP) as part of the Mirvac acquisition, leaving Parramatta commercial property market with 40,000 square metres of vacant space in 2020, has not caused too much concern. This is a significant amount of space, but Wally Scales, director, commercial sales and leasing, capital markets at Knight Frank is of the view that while disappointing for Western Sydney, this will not create major issues for the Parramatta office market. "The Parramatta CBD workforce is forecast to increase by 50 per cent, from 50,000 to 75,000 by 2035, generating a requirement for around 250,000 sqm of additional office space over the next 20 years," Mr Scales said." No slowing down for Sydney’s western leasing market
I dont know if you are asking anybody in particular but i'll answer. There is a very strong Ethnic culture in the areas... for example, Korean, Chinese.... and Homebush. Have a look for yourself. Good (and not over the top expensive) restaurants in the area though. Are you after apartments or houses? Houses in Strathfield have been very very expensive, but more recently surrounding areas have narrowed that price gap. You wont find any bargains though. I imagine near 2 mill would be needed. Homebush has gentified and used to be relatively cheap, but now with the Western Sydney boom its not cheap at all. I think its a suburb that had over 30% growth in one year recently? With a downturn the prices may drop somewhat, and I still see Strathfield houses will be relatively strong in any market. Homebush has a very poor train service if you compare it to Lidcombe or Strathfield and marginally worse/on par with Flemington (if the place you are looking at happens to be walking distance to both stations thats good as they get different services). Apartments. If you are looking yo buy, try for the low rise in either location, as long as the buildings have enough sinking and admin funds available its a good start. But more apartments are being built in the inner west and elsewhere which should dampen capital growth.
