Industrial Trends in Melbourne’s East

By Glenn Neilson September 20, 2019

We thought we would share a brief snapshot of the industrial market as we currently see it.

Leasing: with some exceptions, time on market is now closer to 90+ days. This is up from a typical period of 60 days prior to 2017.  We are seeing good enquiry from tenants seeking 500-1000sqm with strong activity from small start-ups. However, tenants need to see genuine benefits in order to consider moving. Landlords need to ensure their rental expectations are set right on market and be prepared to offer incentives to secure a new tenant.

Sales remain strong, particularly for 5-10 year old quality existing office/warehouse buildings due to low supply. Demand for smaller brand new industrial units in the outer east such as the Croydon/Bayswater areas has slowed over the last 6 months due to an approaching over supply. However, small storage units or factories in the middle ring areas such as Blackburn/Box Hill/Nunawading/Mitcham/Ringwood remain in demand as are quality investment properties with established leases. 

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A shortage of suitable retail space in the City of Whitehorse in particular is resulting in numerous industrial premises in the Blackburn/Box Hill/Nunawading areas being converted to alternative uses such as restaurants & bars, micro-breweries, gyms, indoor trampoline and children’s play centres. This trend is keenly supported by landlords who are able to command higher rental rates from these users.

This trend of “gentrification” is resulting in increased land values in these industrial precincts. A number of Developers in the eastern corridor are finding it difficult to secure sites at rates worth pursuing development.  This will likely have flow on effects for the future supply.

The traditional industrial users of these areas are now looking to relocate further afield to the more affordable areas within the Cities of Knox and Maroondah.

Feature properties for lease/sale

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Unit 10/21 Eugene Terrace, RINGWOOD VIC 3134


474766a9-1e08-e611-80d3-005056a32b56

26 Terracotta Drive,
BLACKBURN VIC 3130


bab7b219-6141-e911-a964-000d3ad02144

Unit 16/100 New Street, RINGWOOD VIC 3134

2d0c7e97-8ecf-e911-a968-000d3ad02144

51-55 Centre Way, CROYDON VIC 3136

Contact GK’s Specialist Industrial Team

Glenn_Neilson_LRGlenn Neilson
Senior Sales & Leasing Consultant

T: (03) 9810 7205
M: 0438 599 244
E: glenn@gormankelly.com.au

 

Jason_Beveridge

Jason Beveridge
Director

T: (03) 9810 7254
M: 0418 333 377
E: jason@gormankelly.com.au

 

Francis_Sbaglia_LRFrancis Sbaglia
Senior Sales & Leasing Consultant - Western Office

T: (03) 9810 7200
M: 0418 565 918
E: francis@gormankelly.com.au

 

Cameron_Hunter_LRCameron Hunter
Senior Sales & Leasing Consultant - Western Office

T: (03) 9810 7212
M: 0424 122 446
E: cameron@gormankelly.com.au

 

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