Costin Investments buys Melbourne industrial property with immediate development upside

A large Thomastown warehouse surrounded by surplus land ripe for redevelopment has sold to Melbourne-based Costin Investments for $4.3 million.

The 9000 square metre holding at 43-47 Northgate Drive includes a 2723 sqm warehouse and office, machine storage space and an open-air car park.

The office/warehouse was built by Vaughan Constructions in 2004.

The property has surplus land available for immediate development.

Based on the property’s current net annual rental return ($316,520), it is exchanging on a 7.4 per cent yield.

The onsite office/warehouse occupies less than a third of the site area.

CBRE’s Daniel Eramo, who marketed 43-47 Northgate Drive with colleague Broderick Turmaine, said Costin Investments plans to take advantage of the building’s low site coverage by further developing out the holding.

The Thomastown office/warehouse is accessed from a large open-air car park.

At the same time, it will retain the income-producing office/warehouse component.

Mr Eramo said the expressions of interest campaign, which closed in late May, was “highly competitive”.

An aerial image showing the Thomastown site (outlined) relative to the Metropolitan Ring Road.

The brokers represented a Sydney-based vendor who paid $3.49 million for it in February, 2015. This investor acquired 43-47 Northgate Drive on an 8.6 per cent yield from West Australian syndicate Property Investment Resources.

Thomastown is about 17 kilometres north of the Melbourne CBD.

In June, we reported that an owner occupier in the building sector paid $7 million for a 2.3 hectare industrial property with low office/warehouse coverage at 1620 Sydney Road, Campbellfield (pictured, below), about eight kilometres west of Thomastown.

The Campbellfield site (outlined) sold to an owner-occupier.

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Marc Pallisco

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