Charter Hall pre-commits Uniqlo Australia to 46,000 sqm Truganina distribution centre

Uniqlo, which started trading in Australia in 2014, has pre-committed to a 46,000 square metre distribution centre at Truganina, in Melbourne’s west.

The $28 billion fashion empire has signed a 10 year lease for the facility to be developed by early 2021, and retained by Charter Hall Prime Industrial Fund (CPIF).

The investment is earmarked for the 60 hectare Midwest Logistics Hub on the north west corner of Dohertys and Palmers roads.

Charter Hall head of development, Industrial and Logistics, Andrew Simon, said the deal with Uniqlo’s owner, Fastline Retailing, “reinforces the changing nature of retail supply chains”.

Uniqlo’s first Australian store, at Emporium Melbourne, opened in 2014.

“The facility will consolidate their operations into one purpose-built facility featuring cross dock operations with a super awning, 14.6 metre warehouse clearance height and container rated hardstand,” Mr Simon added.

After opening at Melbourne’s Emporium, Uniqlo now has 22 Australian stores.

Originally a textiles factory, turned into a retailer by Tadashi Yanai in 1984, Uniqlo was listed on the Hiroshima Stock Exchange in 1994.

It now trades from more than 1000 outlets internationally.

Fifty per cent of Midwest is pre-committed: CPIF

CPIF fund manager, Richard Mason, said the company “is extremely pleased with the early leasing success of the Midwest Logistics Hub, with over 50 per cent of the estate now committed”.

The pre-commitments, he said, reflect that the estate is “the preferred location” for national distribution centres: Melbourne’s west industrial market is amongst the cheapest in Australia which to rent or buy, yet it is convenient to Port of Melbourne, Melbourne Airport and major freeways.

Uniqlo partnered with supply chain and property specialist TM Insight to develop the business case and run the property procurement.

TM Insight will also project manage the construction.

The rent CPIF will receive is at yet undisclosed but understood to circle about $80 per sqm, per annum.

Construction of the first Midwest buildings only started last October

Toll Holdings was the first occupier to pre-commit to Midwest Logistics Hub, about 23 kilometres from the CBD: construction of its 44,000 sqm state-of-the-art distribution centre for Mars Wrigley Australia commencing five months ago.

“The technologically advanced warehouse will store all of Mars Wrigley’s products under one roof for the first time in the company’s history, with the capacity to store up to 49,000 pallets or more than 700 million MARS Bars and use Automated Guide Vehicles to move pallets around the warehouse,” the landlord said.

By September 2020, CPIF intends to have completed all civil and infrastructure works at Midwest.

When fully developed, it is anticipated the business park will accommodate investments worth a total of more than $500 million.

Each asset is targeting a four star Green Star Design and As-Built rating and will incorporate various sustainability initiatives including 100-300kw solar PV systems, LED warehouse lighting and rainwater harvesting.

Mr Richard Stacker, Charter Hall Industrial and Logistics chief executive officer, added the company’s “ability to deliver high specification, modern logistics space in strategic locations across the eastern seaboard continues to attract quality tenant covenants for our real estate funds and their investors”.

Charter Hall’s Industrial & Logistics development pipeline includes stock estimated to have an end value of about $2 billion.

CPIF’s portfolio of 65 investments has a 98.2 per cent occupancy rate. All but five per cent of its tenants are government backed. The weighted average lease expiry is a long 10.7 years.

The Uniqlo deal comes four months after Stockland teamed with Mt Atkinson Holdings to propose Melbourne Business Park – a $2 billion logistics focused estate earmarked for a 260 hectare Truganina site.

Last month, Frasers Property Australia pre-committed CEVA Logistics to a 37,307 warehouse at its West Park Industrial Estate, in the suburb.

CEVA already occupies 238,670 sqm of industrial space within several buildings at West Park.

With its latest lease, FPA has filled all of the 310 hectare estate it first started marketing 16 years ago.

Artist’s impression of part of Truganina’s $2 billion Melbourne Business Park, which Stockland launched last November.
Last month, CEVA Logistics pre-committed to the last piece of Fraser Property Australia’s 310 hectare West Park Business Park, which has been under construction for 16 years.

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Marc Pallisco

A former property analyst and print journalist, Marc is the publisher of