This article is from the Australian Property Journal archive
CADENCE Property Group and GPT have completed their fully leased $150 million industrial estate, Keylink Estate, in in one of Victoria’s most in demand locations, Keysborough.
Comprising 60,686sqm of total GLA across four individual tenancies, the estate at 138 Indian Drive, around 27km south-east of Melbourne’s CBD, has secured leased to Early Settler, Hartman Group, AFS Logistics and Mohawk Industries subsidiary Premium Floors.
National retailer, Early Settler, pre-leased the largest tenancy of 37,890sqm, before Cadence and GPT appointed Colliers to lease the three remaining tenancies totalling 22,796sqm of GLA.
“Undertaking a speculative roll of this scale was ambitious, but the supply and demand dynamics, particularly in the south east, gave us and our partners confidence to secure tenants in a timely manner,” said Charlie Buxton, managing director at Cadence Property Group.
“To have 100% leased Keylink Estate prior completion outperformed all of our expectations and demonstrates both the strong demand for quality industrial space in the area and the unique market environment we are currently experiencing.”
Leading manufacturer and distributor in the DIY, trade and leisure markets, Hartman Group, committed to a 7,450sqm lease.
While integrated warehouse and distribution service specialist, ASF 3PL Logistics committed to an 8,667sqm lease.
“We were attracted to Keylink by the strategic location for our business. This new site complements our existing warehouse network and allows our customers to consolidate their transportation and warehousing requirements with AFS Logistics to achieve an efficient ‘’end to end” supply chain solution,” said Shayne McDonnell, director of ASF 3PL Logistics.
‘’The addition of the new facility increases our 3PL warehousing footprint to ~60,000sqm across a number of sites and gives our existing and new customers confidence that we can support their growth requirements.”
Finally, leading supplier of quality flooring products, Premium Floors, relocated from a smaller facility in Dandenong South and secured a 6,679sqm tenancy.
“As Australia’s largest wholesale supplier of timber and timber look flooring, Premium Floors was drawn to the super-high clearance of the warehouse, offering significantly more cubic capacity than our previous facility,” said Jamie Costello, Australian general manager at Premium Floors.
James Stott, national director at Colliers, noted that Melbourne’s south east is one of the tightest industrial markets in the country, with a vacancy rate of 0.23%, or three vacancies greater than 3,000sqm available out of a total of 1,271 buildings.
“Ongoing levels of strong demand have led to low vacancy rates and restricted conditions for occupiers nationally across all major metro industrial markets,” added Stott.
“This environment has triggered significant competition in the marketplace for quality leasing opportunities, with occupiers competing fiercely to secure space for the limited number of buildings available. We expect the supply side constraints to continue for occupiers until enquiry levels abate and the speculative development pipeline levels can sufficiently satisfy demand.”
This as recent data shows industrial rents are surging at a rate of more than seven times their 15-year average, with prime rents on the east coast growing by nearly 40% over the past three years, secondary rents by 45% and some sub-markets experiencing growth above 50%.
