There is a point every growing ecommerce brand reaches where the garage, the spare room or the back of the shop stops working. Stock is in three places, packing takes the whole afternoon, and someone suggests renting a small warehouse.
It is a reasonable idea. It is also the most expensive way to solve the problem for most brands shipping under a few thousand orders a month, and the reason is not the rent itself. It is everything that comes attached to it.
What Sydney industrial space costs in 2026
Knight Frank's Sydney industrial report for the second quarter of 2026 puts prime net face rents at:
| Precinct | Prime net face rent (per m² per year) |
|---|---|
| South Sydney | A$350 – A$475 |
| Outer West | A$200 – A$250 |
Source: Knight Frank, Sydney Industrial State of the Market, Q2 2026. These are rents for prime industrial stock. Small units and older buildings are priced individually and can sit above or below these ranges, so treat them as a guide rather than a quote.
South Sydney sits beside the airport, Port Botany and the inner city, which is a large part of why it costs up to twice as much as the Outer West.
What a 150 m² unit costs before you pack anything
A 150 m² unit is a common size for a brand moving out of home: room for shelving, a pack bench and a few pallets of incoming stock.
| South Sydney | Outer West | |
|---|---|---|
| Rent per year | A$52,500 – A$71,250 | A$30,000 – A$37,500 |
| Rent per month | A$4,375 – A$5,940 | A$2,500 – A$3,125 |
That is rent alone. On a net lease, the costs of running the building are usually passed through to the tenant on top of the rent, so the monthly figure is the floor, not the bill.
The costs that are not on the lease
Outgoings. Council rates, building insurance, maintenance and other running costs are commonly charged to the tenant on a net lease. Ask for the outgoings figure before you compare two units, because a cheaper rent with higher outgoings is not cheaper.
The lease term and security. Industrial leases are usually signed for years rather than months, and landlords typically ask for a bond or bank guarantee. You are committing to the space whether your sales grow, flatten or fall.
Fit-out. Shelving, a pack bench, scales, a label printer, lighting, internet, a bin service. None of it is expensive on its own. Together it is a real number paid before the first order ships.
Your own insurance. Stock, contents and liability cover for the premises, separate from the landlord's building insurance.
The packing itself. This is the cost brands most often leave out. Someone has to receive stock, put it away, pick, pack, label and hand over to the carrier every business day, cover for leave and sickness, and absorb the Black Friday week. If that someone is you, the cost is the growth you are not working on.
The same volume through a 3PL
At 300 orders a month, published Australian market ranges put the full 3PL bill (pick and pack, storage, receiving and returns) at around A$813 to A$1,715 a month before postage. The full breakdown is on our pricing page.
Put that next to the rent column above. At 300 orders a month, a small South Sydney unit costs roughly A$14.60 to A$19.80 per order in rent alone, before outgoings, fit-out or a single hour of packing. A 3PL covers the whole operation for around A$2.71 to A$5.72 per order.
The gap closes as volume grows, because rent is fixed and per-order fees are not. That is the honest version of this comparison: it is not that renting is always wrong, it is that the volume at which it starts to make sense is higher than most brands expect.
When renting your own space does make sense
- High, steady volume. Several thousand orders a month, every month, with staff you would employ anyway.
- Bulky or unusual products that a 3PL would charge heavily to store or handle.
- The warehouse does more than fulfilment. Production, assembly, a showroom or a photo studio under the same roof.
- A large wholesale side where cartons and pallets, not parcels, are most of the work.
When a 3PL makes more sense
- Under a few thousand orders a month, where fixed rent spread across your orders costs more than per-order fees.
- Seasonal swings. A lease charges you for December's space in February. A 3PL charges for the space you actually occupy.
- You want the hours back. Packing time is time not spent on product, marketing or wholesale accounts.
- You do not want a multi-year commitment while the business is still finding its shape.
The middle options
Searches for shared warehouse space and mini warehouses in Sydney are common, and both exist. They lower the rent and the commitment, but the packing is still yours, and so is the cover for leave and the peak week. They solve the space problem, not the labour problem.
If location is part of the question, Sydney or Melbourne for your stock covers what actually differs between the two cities.
Before you sign a lease, work out three numbers
- Your cost per order in-house: rent plus outgoings plus fit-out spread over the lease, plus the hours spent packing at what those hours are worth, divided by your monthly orders.
- Your cost per order through a 3PL: run your real volumes through the calculator, then check them against an actual quote.
- The volume at which the two cross. If you are well below it, the lease is a bet on growth you have not had yet.
Most brands do the first sum with rent alone and the second with a guess. Doing both properly takes an afternoon and can save a multi-year commitment.
Weighing up a warehouse against outsourcing? Send us your numbers and you will get a written quote broken down line by line, so the comparison is between two real figures rather than a lease and an estimate. If you are still small and want to know whether outsourcing is worth it yet, start with 3PL for small businesses.