Stockland is continuing to push into Melbourne’s western suburb logistics space outlaying $60 million for two unbuilt Truganina warehouses.
The Sydney institution is acquiring the neighbouring investments on a funds-through basis with a rent guarantee from Time & Place and MaxCap Industrial Opportunity Fund.
The properties cover 6.3 hectares or about 41 per cent of the vendor’s 151 Leakes Road business park.
Combined they’ll contain 38,550 square metres of lettable area.
Settlement, then construction, is scheduled for July – conditional on subdivision and titles issuing.
The assets are expected to be complete by April 2022.
Stockland’s development pipeline for workplace and logistics stock is worth $5.5 billion.
Amongst its projects is Melbourne Business Park – which covers 260 hectares, also in Truganina, but a little further west of 151 Leakes Rd.
Stockland in good company at Truganina
Melbourne is considered Australia’s industrial capital and the city’s west is its cheapest side in which to rent or buy large A-grade stock.
Without venturing into Melton or Geelong municipalities, Tarneit is considered amongst the most affordable suburbs; it is also the furthest away from town – about 25 kilometres.
Truganina’s industrial area is between about three and six km closer to the city from there.
Stockland’s proposed 151 Leakes Rd factories are near the Princes Freeway, 14km from the Port of Melbourne (story continues below).
In the immediate vicinity are distribution centres occupied by Kmart, Target, The Reject Shop, Woolworths and Woolworths Liquor.
Heavyweight landlords include Charter Hall, Dexus, Frasers, Goodman, LOGOS and Lendlease.
Time & Place paid $28.6m for the 16.7ha Leakes Rd land last August.
Clear goal to strengthen commercial portfolio: Stockland
Stockland commercial property chief executive officer Louise Mason said the 151 Leakes Rd acquisitions will deliver solid returns and contribute to its growth strategy.
“We have a clear goal to continue strengthening our commercial property portfolio and improving risk adjusted returns through improved income growth and valuation resilience, by executing our $5.5b workplace and logistics development pipeline and new acquisitions in Melbourne, Sydney and Brisbane,” the executive added.
“We expect the logistics sector to prove resilient to the impacts of COVID-19 relative to other sectors, and foresee favourable market fundamentals continuing in the longer term”.
Stockland general manager, Workplace and Logistics, Tony D’Addona, said Melbourne’s western industrial precinct has an undersupply of zoned and serviced land.
“We expect logistics demand to continue to grow along the eastern seaboard as supply chains are reviewed in the aftermath of COVID-19 and the associated rise on online retail,” according to the executive.
“Subject to planning approvals, the proposed development will include prime high quality warehouse facilities which will suit logistics and transport style operators.
“This site sits within a tightly held area of Melbourne and will enable us to leverage our existing customer relationships and welcome new, high-quality tenants into the portfolio.
“The proposed design scheme allows for a variety of warehouse sizes to suit varying tenant requirements”.