Melbourne business park nearly sells out before completion: Savills

Melbourne business park nearly sells out before completion: Savills
Melbourne business park nearly sells out before completion: Savills

Melbourne developer Summers Industries has put several office warehouses on the leasing market following the sale of 26 out of 27 speculatively built industrial units at its circa $12 million Braeside business park.

The units were all sold before completion, reflecting the strength in the south-east industrial market mainly due to Victoria’s strong population growth and a renewed trend of owner-occupier sales. 

Savills’ Gareth Jackson, who marketed the campaign, said nearly 80 percent of the available units sold to owner occupiers.

He said while leasing across the south-east had been remarkably resilient, the voracious owner-occupier appetite for new and existing stock, was unequivocally driving the Braeside market.

“Owner-occupier sales have been picking up over the last couple of years, with the obvious driver low interest rates and more recently Victoria’s strong population growth, but what we are seeing now is, in part, a sense of urgency to buy ahead of what some regard as an inevitable rise in interest rates, and an increasing trend to SMSF investment,” he said.

“US rates continue to rise and with housing affordability such an issue the RBA has no appetite for further cuts, the only way is up, indeed some banks are already leading the way. Having said that we are not likely to see a massive hike anytime soon and so there remains that window of opportunity, if you like, and savvy businesses are clearly taking advantage.’’      

The south-east market is enjoying a purple patch of sorts, accounting for more than 50 percent of total industrial take-up (456,920 sqm) across Melbourne, in the 12 months to March, added Savills head of Research in Victoria, Monica Mondkar. 

It is leading all precincts for the first time since December 2010, along with 31 percent ($657 million) of the total industrial sales by value.

The opening of the Dingley Bypass last March had also been an important driver in the success of the sales and leasing of development projects in the Bayside market, Jackson said.

The 6.4 kilometre, six-lane road linking Warrigal Road at Moorabbin and Westall Road at Dingley Village was built with the promise of reduced traffic delays and congestion.

He said purchasers had also been drawn to the depreciation benefits and stamp duty savings, on-title car parking, container access and NBN connectivity.

Savills marketed the properties along with Nixon Real Estate. 

Tags: 
Property market Commercial Lease

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