Cbus Property sells modern warehouse built on ex-Holden plant in Dandenong South

Cbus Property has banked $4.25 million selling a modern warehouse built on part of a former General Motors Holden car making plant, in Dandenong South.

The deal for 49 Assembly Drive, a fully leased investment tenanted to a food distributor, was struck at $350,000 more than the guide price.

Based on the annual rental return, it is trading on a 6 per cent passing yield, CBRE brokers Tim Homes, Patrick Noone and James Jorgensen said.

The 2552 square metre building sits on a 4645 sqm plot within Cbus’ Estate One industrial estate.

Estate One is taking shape on a 46-hectare block owner-occupied by General Motors Holden between 1956 and 1996.

A Victorian Places image from inside the GMH Dandenong South car making plant, circa 1964.

When it opened, the factory could output 168 vehicles a day. By the early 1980s, more than four million cars had been produced there. The last model was the Nova, which Toyota was marketing as the Corolla, part of a joint venture agreement between the makers which started in 1986.

In 1997 GMH sold the Dandenong South plant at 81-125 Princes Highway to Phileo Australia for $22.5 million.

After re-purposing the property into an industrial park, and constructing some buildings, Phileo Australia flipped it to Cbus for $136.5 million ten years later.

Cbus has been progressively been developing the site: in 2016, it sold a near-new investment grade office at nearby 45 Assembly Drive to IOOF Investment Management for $20.75 million.

The derelict General Motors Holden train station, at the bottom of Assembly Drive, Dandenong South.

The former General Motors train station – which GMH paid to construct in 1956, but which closed in 2004, is at the bottom of Assembly Drive.

Ageing GMH-related factories still stand on the Dandenong South block.

In 2016, the state government paid GMH about $130 million for a 37-hectare Fishermans Bend factory, which had also just been made redundant.

Car manufacturing ceased in Australia with the assembly of a Toyota Camry in Altona in October, 2017.

Last month, we reported that Pelligra Group acquired three former Ford factories, in Geelong and Campbellfield.

Pelligra Group also acquired GMH’s former Elizabeth plant, north of Adelaide, in 2017.

Earlier this week Cbus announced it issued a Notice to Vacate to the Mercure Hotel, which occupies 17 Spring Street in the Melbourne CBD. Cbus plans to replace this site, which it bought in 2017, with a 33-storey high-end apartment building containing 84 dwellings.

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Marc Pallisco

A former property analyst and print journalist, Marc is the publisher of realestatesource.com.au.