Large-scale industrial sites in Melbourne’s south and outer-east suburbs are fetching record prices, as buyer appetite continues to escalate.
Colliers International is experiencing unprecedented demand from developers, land-bankers and owner-occupiers wanting to remain in or move to the Monash precinct.
Industrial agents Justin Fried and Jonathan Mercuri have welcomed more than $60million in assets to market in recent months, saying enquiry was “through the roof”.
“Developers are looking to landbank sites for higher or better use, while occupiers are trying to enter or stay in the market, with the view to own, rather than lease, their factory assets,” Fried said.
The Monash precinct had experienced “a real lack of industrial stock historically”, due to its popularity and long-term private ownership creating tightly held estates, according to Fried.
“For those seeking sites more than 5,000 sqm, there were simply no options in recent years,” he said.
“With such strong demand at present and an increasing buyer demographic wanting to take advantage of the business opportunities within the Monash Employment Cluster, we’re encouraging owner-occupiers to offload their assets and capitalise on the premium prices being achieved.”
On the other side of the city, the industrial leasing market in Melbourne’s north has seen strong tenant demand continue to absorb supply of prime-grade stock.
Colliers International’s Marco Sandrin said this was particularly the case in the food and beverage, logistics and specialised manufacturing industries.
“As leasing space and supply continues to tighten across the northern suburbs, we are also starting to experience a reduction in let-up time and incentives, with one of the key drivers being a shrinking serviced land allotment pipeline,” he said.
“With respect to current leasing vacancy for more than 10,000sqm, we are currently experiencing the tightest market there has been for many years, with only eight buildings available totalling just more than 100,000 sqm.”
Sandrin said two of the most significant transactions that had occurred this year were within the Melbourne Airport precinct.