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Early movers to reap rewards from new Metro lines
Commercial property values along Sydney’s Metro line have doubled, positioning suburbs near the new western transport links as prime opportunities for investors seeking premium returns
Commercial property values along the Sydney Metro line have doubled, with recent data showing that suburbs near the new western transport links are poised to deliver premium returns for agents and investors who act quickly.
With Metro extensions to Bankstown and Westmead, plus a new line to Western Sydney Airport, agents and investors who act fast could see their property value rise and almost double over time.
According to the latest data from CBRE’s Metro-fication 2.0 report, office values in key markets along the Metro’s Northwest line began to climb long before the line officially opened.
CBRE’s analysis of suburbs along the Northwest line showed that office rents began to climb in 2014, following the announcement of the Metro.
The firm said that if past trends hold, commercial investment along the upcoming Metro lines is set to pick up in the coming years, with apartment growth along the West Line expected to accelerate over the next two years."
CBRE Associate Director of Research Thomas Biglands said the findings suggested that office occupiers began making leasing decisions well before the completion of the Northwest line, seeing the potential benefits of the new transportation links
“This shows that capital looking to invest near future metro stations must have foresight and invest well ahead to capture income and capital value appreciation.” Biglands said.
By investing along the Metro line ahead of the anticipated growth and interest in the area, buyers set themselves up to grow along with the suburb.
“The Metro network and Western Sydney Airport will fundamentally reshape movement across the city, and we want our venues to evolve alongside that.”
According to the data, rents in Macquarie Park grew by 31 per cent over five years, while those in Chatswood and Crows Nest rose by around 52 per cent by the time the project was completed in 2019.
Additionally, the values of offices in these areas also soared, with the capital value of offices in Crows Nest more than doubling, having grown by 126 per cent from 2014 to 2019.
The capital value of offices in Chatswood and Macquarie Park also experienced strong growth over the same period, with Chatswood increasing by 95 per cent and Macquarie Park by 92 per cent.
With a Metro line connecting Westmead to the CBD due to be completed in 2032, the findings suggest that offices in Parramatta will be the next key beneficiary of the new transport links, with increased access enhancing the area's office appeal.
The completion of the Western Sydney Airport line could unlock entirely new office precincts, with areas such as Bradfield set to benefit from increased accessibility.
The report also found that the hospitality and retail sectors are also set to benefit from the new lines, with food and beverage spending along the City and Southwest sections of the Metro growing substantially since its opening.
With an average of 5.8 million monthly riders on the Metro, Sonnel Hospitality Chief Executive Officer Simon Meers said that the transportation system had altered foot traffic patterns and enabled customers to visit new areas.
“Transport infrastructure plays a major role in shaping how people live, move and socialise,” Meers said.
Additionally, dwellings within walking distance of a Metro station have seen their values skyrocket, according to the latest Domain report.
Houses less than 400m away from a station are valued around 16.6 per cent higher than similar houses 2-3km away.
Domain’s data showed that unit prices rose even more than houses when close to the Metro, with those within 400m selling at 24.4 per cent more than those just 800m-2km away.