Desane locks in $14.5 million build for 44-unit Penrith project

Fixed-price contract moves Penrith into construction

Desane Group Holdings Limited (ASX:DGH) has committed to a $14.5 million fixed-price design and construct contract for its 44-unit industrial development at 91 Thornton Drive, Penrith. The agreement, signed by wholly owned subsidiary Desane Properties with Full Tilt Constructions, excludes GST and is expected to take the project from planning into active construction.

Works are scheduled to begin in mid-November 2026, with final occupation anticipated in early 2028. The contract follows an extended period of design, regulatory approval and negotiation, according to Desane, and gives the company a defined construction cost for the project at a time when it says construction costs and broader economic conditions remain challenging.

44 warehouses target smaller industrial buyers

“Image – artist’s impression”

The development will span roughly 1.2 hectares across three buildings, with warehouse areas ranging from about 73 square metres to 132 square metres. Forty of the units will also include office accommodation, while the project will provide 85 on-site car spaces, including electric-vehicle and accessible parking.

The product is aimed at small businesses, trades, owner-occupiers and private investors. Preliminary assessments by Ray White Commercial Western Sydney and PRD Penrith indicate that most units could be priced below $1 million, although Desane stressed that final prices will be set closer to the sales and marketing campaign and will depend on prevailing market conditions. The project had previously been identified as one of the developments central to Desane’s FY27 plans in its Penrith project update.

Sales strategy leaves proceeds and margins open

Desane plans to sell the units in stages, while retaining the option to assess the longer-term investment value of individual properties as construction progresses. That approach provides flexibility over the mix of sales and retained assets, but the announcement does not disclose expected project revenue, development margins, presales or funding arrangements.

For shareholders, the fixed-price structure reduces one source of construction uncertainty, but it does not settle the broader economics of the development. The next material markers are likely to be the start of site works, the launch of sales and marketing, buyer demand at final prices, and any disclosure about the cash required to complete the project.