Land scramble leads to surging prices for industrial sites

Part of the old Woodlands Park Estate in Donnybrook, an old farm north of Melbourne, is for sale and expected to fetch more than $160 million.

The two lots on 910 and 960 Donnybrook Road, once dairy and sheep grazing land, have been rezoned industrial as part of the Donnybrook-Woodstock Precinct Structure Plan.

They are one of the only PSP approved industrial holdings of any scale remaining in the city at a time when demand for industrial property is sky high.

The expressions of interest campaign is being handled by national real estate and advisory firm LAWD’s Peter Sagar, Paul Callanan and Darcy Tobin in conjunction with agent JLL’s Matt Ellis and Mario Moscon.

“We expect these opportunities to receive significant interest from a buying pool including major institutions, large privates, developers, and syndicates. Industrial is the new retail,” Sagar said.

Internet shopping, fuelled by the pandemic and lockdowns, has intensified the need for city-fringe warehousing and logistics.

The larger 76.45 hectare parcel at No.960 was bought by Donnybrook JV in 2015 for $13.92 million. Records show the joint venture is owned by private equity player CVC and Avid Developments.

Next door at No.910, the smaller 10.89 hectare lot was bought by a residential developer who is now planning to sell given the industrial zoning.

The land is close to major freight and transport hubs, including the Hume Freeway, the Ring Road, the Somerton Intermodal Terminal and Melbourne Airport.