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Bayside park sells out, bar one, before completion

Property Markets / Transactions

Australia

Apr 12 2017

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April 11, Melbourne – Melbourne bayside developer, Summers Industries, has put several office warehouses on the leasing market following the sale of 26 out of 27 speculatively built industrial units at its circa $12 million Braeside business park.

The units have all been sold before completion as the south-east industrial market undergoes a striking resurgence driven chiefly by Victoria’s population growth as well as a renewed trend to owner-occupier sales. 

Savills Notting Hill office Director, Gareth Jackson, said the firm’s south-east office had been inundated with enquiry for owner-occupier opportunities with nearly 80 per cent of the units available selling to that single cohort.

He said while leasing across the south-east had been remarkably resilient, the voracious owner-occupier appetite for new and existing stock, was unequivocally driving the Bayside market.

"Owner-occupier sales have been picking up over the last couple of years, with the obvious driver low interest rates and more recently Victoria’s strong population growth, but what we are seeing now is, in part, a sense of urgency to buy ahead of what some regard as an inevitable rise in interest rates, and an increasing trend to SMSF investment.

"US rates continue to rise and with housing affordability such an issue the RBA has no appetite for further cuts, the only way is up, indeed some banks are already leading the way. Having said that we are not likely to see a massive hike anytime soon and so there remains that window of opportunity, if you like, and savvy businesses are clearly taking advantage," Mr Jackson said.     

According to Savills Head of Research in Victoria Monica Mondkar, the South-East market is enjoying a purple patch of sorts accounting for more than 50 percent of total industrial take-up (456,920 sqm) across Melbourne, in the 12 months to March leading all precincts for the first time since December 2010, along with 31 per cent ($657 million) of the total industrial sales by value.

Mr Jackson said the opening of the new $156 million Dingley Bypass last March had also been an important driver in the success of the sales and leasing of development projects in the Bayside market.

The 6.4 kilometre, six lane, road linking Warrigal Road at Moorabbin and Westall Road at Dingley Village, was built with the promise of reduced traffic delays and congestion and improved traffic flow with more direct road connections.

He said purchasers had also been drawn to the depreciation benefits and stamp duty savings, on-title car parking, container access and NBN connectivity.

The properties were marketed in conjunction with Nixon Real Estate. 

 

About Savills

Savills is a global real estate services provider listed on the London Stock Exchange. Savills operates from over 700 corporate and associate offices, employing more than 30,000 people in over 60 countries throughout the Americas, the UK, Europe, Asia Pacific, Africa and the Middle East, offering a broad range of specialist advisory, management and transactional services to clients all over the world. www.savills.com.au or www.savills.com. Follow @SavillsAus for the latest Australian and global real estate news and research.

SOURCE: Press Release

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