Komatsu rumbles into Frasers logistics estate
Singapore’s Frasers Property Industrial has secured another big multinational corporation for its Canvas West logistics estate in Tarneit in Melbourne’s west after leasing a brand-new warehouse and office facility to Japanese construction and mining equipment manufacturer Komatsu.
Komatsu, whose products include bulldozers, dump trucks and excavators, has agreed to lease the 12,526 sq m warehouse, office and customer service centre on a 10-year term which will kick off when the development is completed in early 2024.
The Japanese company will use the new facility as a storage and distribution centre for its earth-moving spare parts business. Sustainability features will include a rooftop solar array, energy and water metering and monitoring, and energy-efficient internal and external LED lighting with automated control systems.
“Komatsu has committed to reducing our carbon footprint by 50 per cent by the end of this decade and this new facility will contribute to that objective,” said the company’s executive general manager of supply chain, Russell Hodson.
Mr Hodson said the new facility was part of Komatsu’s expansion of its footprint in Australia and follows the multinational opening two other facilities in Australia this year.
The Japanese company – the world’s second-largest heavy equipment maker behind Caterpillar – will join Netherlands-based online retailer VidaXL, ASX-listed Silk Logistics and local manufacturer Shaw Fabrics as tenants of the 42.3-hectare estate, which is expected to have an end value of $110 million to $140 million upon completion.
The Komatsu deal, brokered by Scott Nienhuis and Laagan Whalan of Savills Australia, adds to a strong run of major industrial leasing deals up and down the East Coast this year, fuelled by the growth of e-commerce and companies looking to optimise their supply chains.
FPI, which owns and operates over $12 billion of logistic assets globally, of which more than half are in Australia, will also develop an adjacent speculative facility at its Canvas West that will take the total development size across the two projects to over 41,000 sq m.
Andrew Hanna, general manager for Victoria at Frasers Property Industrial said demand for quality industrial space in Melbourne’s west remained strong amid a backdrop of low stock and vacancy.
FPI, a subsidiary of Singapore real estate giant Frasers Property, reported a pre-tax profit of $S460.4 million for the 12 months to September 30.
FPI chief executive Reini Otter said strong demand for new and existing facilities was driving healthy rental growth and supporting valuations amid a moderation of the yield compression cycle.
Prime industrial rents in Melbourne’s west have increased 21 per cent over the past year to average $100 per sq m, according to a third-quarter report by Cushman & Wakefield.
Get a weekly roundup of the latest news from Commercial Real Estate, delivered straight to your inbox!
