Hicks Transport Group has purchased a 937sq m building in Sunshine West.

Industrial property in Melbourne's north in hot demand

Stephen Miles|Mar 29, 2023

A shortage of available industrial land in Melbourne’s north is driving strong competition among commercial property buyers.

The latest sale, a 2737 square metre development site in Epping, was purchased off-market by an owner-occupier for $3 million. They intend to construct a purpose-built facility to expand their industrial footprint.

The deal was brokered by Colliers agents Corey Vraca and Mitch Purcell.

Colliers has secured nine out of the past 15 titled vacant lots in Epping at a combined land area of 28,892 sq m.

The northern precinct is attractive to businesses because of its access to transport links and proximity to Epping Plaza Shopping Centre, Northern Hospital, Mantra Hotel and rapidly growing residential catchments.

“Well-located industrial assets with access to transport and established amenities continue to transact at strong levels, despite the economic climate of rising interest rates,” Purcell said.

Education market strength

An entire office floor at 313 Flinders Lane, on the corner of Mill Place and Flinders Lane, has been sold to an education provider for $2.5 million, in a further sign the city’s international education sector is rebounding.

CBRE’s Alex Brierley, Nathan Mufale and Sam O’Connell acted on behalf of the long-time owner – charity organisation International Social Services.

The property is opposite the former 301 Flinders Lane Victorian University campus, which recently moved to new headquarters at 370 Little Lonsdale Street.

The 280 sq m unrestored office was offered with vacant possession at a little less than $9000 a sq m.

“With the reopening of the international borders, we have been inundated with requirements from education colleges looking to purchase offices ranging in size from 150 sq m to 1000 sq m,” Brierley said.

“Professional services and education groups have been responsible for 90 per cent of Melbourne CBD office purchases since the fourth quarter of last year, and we expect this trend to continue well into 2023.” he said.

The next test of the CBD office market could be a property at level 18, 41 Exhibition Street and an entire floor at level 12, 50 Market Street, occupied by interior designers Graham Nicholas.

CBRE is also handling those sales.

Sunshine West

Hicks Transport Group has purchased a 937sq m building in the western industrial market at 36-40 Strzelecki Avenue for $7.25 million.

The building has a low site coverage of just 15 per cent of the total land area of 6301 sq m. Colliers agents Anthony Ongarello, Ned Walmsley and Charlie Woodley handled the deal.

Pakenham

A private investor has snapped up a strata retail outlet leased to a Thai massage provider for $780,000, reflecting a yield of 5.2 per cent.

Located at 11/1 Hunt Way, the 89 sq m property is part of a recently completed neighbourhood complex and is leased for five years at $40,324 per annum.

Burgess Rawson’s Shaun Venables, Justin Kramersh, David Napoleone and Romanor Falconer brokered the deal, together with Camerons’ Nicole Robertson.

Cheltenham

A 104 sq m warehouse with a rear courtyard at 18, 337 Bay Road has sold at auction for $715,000.

Located in one of the most popular and tightly held business parks in Bayside, the property attracted more than 40 enquiries, mostly from owner-occupiers.

“The price was 15 per cent above the reserve and a record amount of $6875 per sq m for the Bayside business district,” Nichols Crowders selling agent James Glen said.

Newton

A local developer outbid four rivals to purchase two sites at 10 and 12 Riversdale Road at auction from a local family for $2.5 million.

Land sizes of the triple-street frontage properties are 604 sq m and 640 sq m, with the price reflecting a land rate of $2010 a sq m.

Darcey Jarman’s Tim Darcy and Andrew Prowse handled the sale, which came a week after they sold 36 Boswell Avenue, Newtown, for $2.6 million, equating to $1500 a sq m.

Hoppers Crossing

Barry Plant Commercial has sold four factories on 3003 sq m of land at 45-47 Industrial Avenue for $3.3 million – $400,000 above their reserve.

Six bidders battled it out to secure the space, with the sale reflecting a land rate of $1098 a sq m and a yield of 3.3 per cent.

Prahran

A popular Japanese restaurant on the corner of Greville Street and Porter Street, opposite Prahran railway station, has sold under the hammer to a Chinese investor for $1.45 million – 15 per cent above its reserve.

The sale represents a strong building rate of more than $22,000 a sq m.

Occupied by restaurant Mizu, the 65 sq m corner shop returns about $73,000 annually in rent.

CBRE’s Alex Brierley, Nathan Mufale, Sam O’Connell and JJ Heng managed the sale.

“While investors have become increasingly savvy, we are continuing to see strong demand in the sub-$10m private investor space, particularly from Asian-based capital.” Mufale said.

South Melbourne

Bottle shop operator Thirsty Camel has purchased a new 549 sq m, two-storey office at 143 Cecil Street for $3.5 million.

The A-Grade property, about 100 metres from South Melbourne market, features a reception area, office space, boardroom, outdoor courtyard, kitchen, plus seven car parks.

Jones Real Estate agents Luke Peric and Sam Guest brokered the deal.

LEASEMount Waverley

Gorman Allard Shelton’s Dean Alexander has negotiated a three-year lease of 72 Stephensons Road on behalf of a long-term local investor to a skincare group at $48,000 a year.

The residential, converted building has a medical permit for two full-time practitioners and provides nine on-site car parks.

Brunswick

A hospitality premises previously occupied by Bar Texaco, at 644 Sydney Road, has been leased to Good Days, which runs a restaurant in Chapel Street, Windsor.

The operator plans to open a Banh Mi bakery at the new premises.

Dean Alexander, from Gorman Allard Shelton, inked a five-year lease on the property, with rent starting at $45,000 a year.