24
Sep

Petrol stations are being resold as development sites to meet rising demand for land

A raft of petrol stations across Sydney could soon be transformed into residential apartments as fuel providers hope to unlock the development value of their land. Find out if you will be impacted.

Forget pumping petrol, a raft of service station owners are pumping up the profits by selling their land to developers.

Nearly 20 NSW petrol stations have gone up for sale this spring marketed squarely at developers on the hunt for prime residential and mixed-use building blocks.

It follows a recent spate of petrol station redevelopments across Sydney, particularly in the inner west.

A BP petrol outlet on Darling St in Rozelle was developed into 22 apartments completed late last year — a construction deal worth an estimated $10.7 million, according to Cordell records.

A historic petrol station on Percival Rd in Stanmore was closed and resold as a development site for $3.1 million in 2014 and is today a block of nine apartments.

Petrol stations currently up for sale as development sites include 16 Caltex stations spread across Sydney, in suburbs like Bondi, Newtown, Drummoyne, Gladesville, Rose Bay, Sylvania and Concord West.

Western Sydney Caltex stations being sold off as development sites were in Casula, Richmond, Mt Druitt and Merrylands.

The fuel company is understood to also be planning a sell off of even more service stations next year. They are offering to remediate the sites once sold, stripping them of the pumps and other service station facilities to convert them into buildable sites.

A Caltex spokesman said the properties were for sale after being “identified as able to deliver a higher value through alternative use”.

Stonebridge Real Estate director and selling agent Lincoln Blackledge said the petrol stations were simply more valuable as building sites than as petrol outlets.

“Demand from developers is very strong, especially for residential (sites),” he said. “As Sydney’s density has increased, sites with mixed use potential are getting very well received.”

Petrol stations tended to be excellent development sites because they were on prominent thoroughfares and in areas with zoning that supported higher density development, Mr Blackledge added.

CBRE investments director Mark Wizel, also involved in the sale, said prices for individual properties were likely in the millions and the sites would suit 40-80 units.

NRMA spokesman Peter Khoury said petrol station redevelopments were concerning since some Sydney residents already had to travel far to get to the nearest pump.

“A lot of the petrol stations that are now prime real estate are in areas where there weren’t many to start with. When there’s less competition, petrol prices tend to go up.”

Mr Wizel said Caltex’s offering was likely to attract interest from local and Asian developers.

 

Extracted from news.com.au