An investment in Dandenong South – considered Melbourne’s most exclusive industrial region outside of the inner-city – has sold to a Sydney group for $15.46 million reflecting a low 5.2 per cent net yield.
On 3.89 hectares, 75 South Gippsland Highway was offered with 6.1 years left on a lease to Onsite Rental Group.
There are 3400 square metres of office/warehouse area in five buildings.
The site has significant frontage to what will be the Dandenong Bypass extension.
It also contains 12 car parks.
The agents promoted the long-term development upside of the Commercial 2 zoned parcel.
Their result values every sqm at $398 (story continues below).
Dandenong South is 31 kilometres from the CBD.
With neighbouring Dandenong, it is considered one of the priciest parts of the city to buy or rent A-grade industrial stock.
“With forecasted supply of zoned industrial land in the south east at record lows coupled with institutional demand driving record low compression, Colliers expect premium land banking opportunities like 75 South Gippsland Hwy to be keenly sought after by astute investors,” Mr Stott said.
Four months ago Frasers Property Industrial launched the 41.3ha Rubix Connect business park in the suburb and secured Ozito as the first tenant.
Salta Property’s Nexus Industrial Estate – which is earmarked for an intermodal terminal connected to Port of Melbourne – is also at Dandenong South.
In late 2019 Charter Hall paid $100m for a factory on 20ha in the area offered by Viridian Glass with a leaseback expiring in 2028.