‘Last mile' logistics sites to deliver GM Property $90m

The five freestanding office/warehouses in Enterprise Park cover nearly 20,000 square metres and are fully leased, returning $2.47 million a year, with a weighted average lease expiry of 5.5 years on a 3.8 hectare site close the Monash and Eastlink Freeways.

Title documents show GM purchased the Tottenham site last year from freight operator Allied Container Services for $16 million before signing up Cargo Freight Services to take over the facility on a new eight-year lease.

The 4.07 hectare block at 1 Quarry Road in Tottenham hosts an 8091 square metre shed and is expected to sell on a yield around 4 per cent, fetching GM about $35 million.

The offices and warehouse in Mulgrave, held by GM for about seven years, are likely to sell for around $60 million.

Dawkins Occhuito’s Chris Jones said Melbourne’s industrial market has “moved considerably” and both sites are underpinned by significant land components making them prime locations for future development.

“Both of these assets are in genuine last mile locations,” he said.

“Enterprise Park represents an exceptional investment opportunity with a secure lease profile and outstanding future redevelopment upside, in a great location. The asset has enjoyed recent leasing success and is undergoing more than $3 million in capital upgrades.”

Industrial infill sites with a capacity for warehousing focused on ‘last mile’ deliveries to consumers are in high demand as retail businesses and third-party logistics providers rush cater to an ecommerce boom supercharged by the changing habits of shoppers during the pandemic.

“They come to market at a time of strength for the industrial and logistics sector with occupier demand at record levels and vacancy at all-time lows. Appetite for land seems insatiable and this is placing significant upward pressure on rents,” Jones said.