Industrial facility in Melbourne’s south east sets sale price record

A Melbourne warehouse has sold for a record price as demand continues to be strong amid a shortage of stock.

The 6,152sq m office/warehouse on 8,881sq m at 12 Koornang Road in Scoresby was purchased for $16.8 million by an owner occupier from the vendor, Wanslea Terrace Pty Ltd, equating to a record rate of $2,731/square metre for the area.

The deal was negotiated by Stuart Gill and Steven Salopek of Knight Frank following an on market Expressions of Interest campaign.

Mr Gill said the campaign attracted more than 100 enquiries from owner-occupiers, investors and funds resulting in seven highly competitive offers.

The buyer was an owner-occupier who plans to occupy the site later this year.

“Prior to the on-market campaign the vendor had received offers brought in from another other agent in the low $14 million range, but our on-market campaign resulted in a sale price of nearly 20 per cent higher,” he said.

“Demand was so incredibly strong due to the ongoing shortage in Melbourne’s industrial market, and the competition for the asset led to an escalation in the price with a record being achieved.

“There is limited supply of industrial property sized at more than 5000 square metres for sale in the south east of Melbourne.”

Mr Salopek said buyers were also attracted industrial property because it was a high-quality asset in a sought-after location close to Eastlink.

“The property also provides the flexibility to subdivide in the future, subject to council approval, to create two smaller warehouses,” he said.

“It is located within the city of Knox’s industrial precinct, in close proximity to Eastlink and Stud Road providing excellent access to Melbourne’s road network.

“The asset also has excellent amenity, being close to cafes, retail precincts and gymnasiums.”

Major occupiers within the area are Mondelez, Multicrop, Thermo Fisher Scientific, Hallmark Cards, Davey Water Products, Bucher, CSR Bradford and Cummins.

The latest industrial research from Knight Frank found vacant space in Melbourne’s South East declined by 16 per cent over the first quarter of 2022, and was down by 11 per cent year on year due to surging demand for industrial space.

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