- Record lease rate of $115/sqm (net)
- CBRE negotiated the five year lease
- Development reflects strong industrial market in Melbourne's west
Apex Transport and Logistics – a company which offers national line-haul services – has leased a new industrial warehouse for a record rate of $115/sqm (net).
The speculative development sold quickly, being located in Melbourne’s premium industrial and logistics suburb of Tottenham. It is five kilometres from the Port of Melbourne and nine kilometres from the CBD and has appealing access to the surrounding major road networks. It provides easy access via four roller doors covered by a large loading canopy.
Fergus Pragnell, Ricardo Cappelletti, Tom Murphy from Lachlan May from CBRE’s Advisory and Transaction Services – Industrial & Logistics team negotiated the five-year lease.
Lease terms included minimal incentive, no landlord fit outs and the option to extend for a further five years.
This is a latest development to reflect industrial occupiers displaying renewed confidence in the market.
According to NAB’s business confidence index – which is an early signal of future economic activity such as spending, hiring, and investment – business confidence by industry has continued to climb, reaching its highest level since early 2010.
IBISWorld’s forecast also displays a positive future. Their business confidence index is expected to average 6.5 index points over 2020-2021, surging in the December quarter of 2020 and representing the most optimism businesses have had since 2009.
“This transaction represented a record lease rate for a property of this size in Melbourne’s west, and is an encouraging sign for the industrial market in Melbourne,” Mr Pragnell said.
Aliro Group, a national development, investment, and funds manager appointed commercial builder Texco to complete the purpose-built development.
“Securing a lease only one week after practical completion of construction suggests that speculative development continues to perform in the western industrial market, with an increase in market activity supporting steady rental growth,” Mr Cappelletti said.
CBRE’s recent report, Restart the Uneven Recovery – Industrial & Logistics, found that the rise in rents for industrial assets is expected to continue moderately across the major cities.
Despite some challenges during COVID-19, CBRE’s report revealed the Industrial & Logistics sector suffered the least in 2020, recording an increase in sales volumes in Australia, while activity in office, retail, and hotel assets declined.