 Asset Class: | Industrial |
 Price: | $ 10000000 |
 Net Yield: | 6.50 % |
Net Yield - including solar strategy: | % |
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<b>Freehold Industrial Investment with High-Quality Food-Grade Fit-Out</b><br><br>49-53 Plateau Road, Reservoir is a rare freehold industrial asset featuring a quality food-grade fit-out, making it an exceptional investment opportunity in Melbourne’s highly constrained food production market.<br><br>With large-scale food manufacturing facilities in short supply, especially in prime last-mile locations, this high-yielding property offers investors both secure long-term income and significant landbanking potential. Strategically positioned<b> just 12 km from Melbourne’s CBD</b>, the property provides seamless access to major transport networks, ensuring prime distribution capabilities.<br><br>Sitting on a massive 7,122 sqm freehold landholding, the site boasts a high 73% site utilization, a ratio no longer permissible under current regulations, making this an irreplaceable industrial asset. With a secure 12-year lease to The Mushroom Group (TMG) and a purchase price significantly below replacement cost, this is a premium investment-grade opportunity with both strong immediate returns and long-term upside.<br><br><b>Buy Below Replacement Cost – Strong Value Proposition</b><br><br><p style=""><span style="font-weight:normal;">A 5,200 sqm high bay warehouse, built to a medium finish, has an estimated replacement cost ranging between $7.8m – $9.5m (excluding capital and holding costs).</span></p><p style=""><span style="font-weight:normal;">With a total landholding of 7,122 sqm, and land values in Reservoir averaging around $1,000/sqm, the estimated land value alone is approximately $7.12m.</span></p><br><b>When factoring in both construction and land costs, the total development cost for a similar facility would range between $14.92m – $16.62m.</b><br><br><p style=""><span style="font-weight:normal;">This contrasts with the current purchase price of $10m, presenting significant medium- and long-term upside through below-replacement acquisition, secure lease income, and rising industrial land values in Melbourne’s tightly held inner-north market.</span></p>
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<p style=""><span style="font-weight:normal;">Located 12 km north of Melbourne’s CBD, Reservoir is a key industrial and logistics precinct within the City of Darebin, offering strong transport connectivity, industrial demand, and affordability compared to inner-city markets. Its proximity to key road, rail, and freight networks makes it ideal for manufacturing, warehousing, and last-mile logistics.</span></p><br><br><b>Demographics & Economic Overview</b><br><br><ul style="list-style-type:disc;list-style-position:inside;padding-inline-start:20px;"><li style="list-style-image:none;"><p style="display:inline;"><span style="font-weight:normal;color:rgb(51, 51, 51);font-style:normal;">Population: 158,210 (2025), projected to grow to 216,417 by 2046.</span></p></li><li style="list-style-image:none;"><p style="display:inline;"><span style="font-weight:normal;color:rgb(51, 51, 51);font-style:normal;">Cultural Diversity: Strong migrant population, particularly from Italy, Greece, India, and China.</span></p></li><li style="list-style-image:none;"><p style="display:inline;"><span style="font-weight:normal;color:rgb(51, 51, 51);font-style:normal;">Economic Output: $19.746 billion annually, with 56,000+ jobs in manufacturing, logistics, construction, and retail.</span></p></li><li style="list-style-image:none;"><p style="display:inline;"><span style="font-weight:normal;color:rgb(51, 51, 51);font-style:normal;">Gentrification & Investment Growth: Increasing infrastructure investment and rising land values, driving strong rental demand for industrial properties.</span></p></li></ul><p style=""><span style="font-weight:normal;">Transport & Infrastructure</span></p><br><ul style="list-style-type:disc;list-style-position:inside;padding-inline-start:20px;"><li style="list-style-image:none;"><p style="display:inline;"><span style="font-weight:normal;color:rgb(51, 51, 51);font-style:normal;">Road Access: Metropolitan Ring Road (M80), Hume Freeway, and Eastern Freeway provide seamless freight and logistics connectivity.</span></p></li><li style="list-style-image:none;"><p style="display:inline;"><span style="font-weight:normal;color:rgb(51, 51, 51);font-style:normal;">Public Transport: Reservoir Train Station (Mernda Line) and extensive bus networks enhance workforce accessibility.</span></p></li><li style="list-style-image:none;"><p style="display:inline;"><span style="font-weight:normal;color:rgb(51, 51, 51);font-style:normal;">Freight Hubs: </span></p></li></ul><span style="font-weight:normal;">15 km from Port of Melbourne, </span><br><span style="font-weight:normal;">20 km from Melbourne Airport</span><br><br><ul style="list-style-type:disc;list-style-position:inside;padding-inline-start:20px;"><li style="list-style-image:none;"><p style="display:inline;"><span style="font-weight:normal;color:rgb(51, 51, 51);font-style:normal;">North East Link Project ($15B investment) will further enhance industrial accessibility and freight efficiency.</span></p></li></ul><br><br><p style=""><span style="font-weight:normal;">Reservoir is a rapidly evolving industrial hub, offering affordable large-scale industrial sites, strategic transport access, and strong economic fundamentals. With rising land values, increasing infrastructure investment, and a high-growth economy, it presents a prime opportunity for industrial investors and businesses seeking long-term capital growth.</span></p>
Additional Location Information File<b>The Mushroom Place</b> <span style="font-weight:normal;">is a family-owned and operated business, </span><b>established in 1987</b><span style="font-weight:normal;">, specializing in the cultivation, processing, and distribution of fresh mushrooms. With over 35 years of experience, the company has built a strong reputation in Melbourne’s agricultural sector, supplying high-quality, locally grown mushrooms to wholesalers, retailers, and food service providers.</span>
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Tenant: The Mushroom Place<br><br>Net Rent: $650,000 + outgoings + GST<br>Lease term: 12-year lease<br>Option: 1x 5-year option<br>Rental Reviews: 4% annually<br>Market Review: At option<br><br>Security: Negotiable terms, with a 6-month bank guarantee floated in discussions<br><br>Outgoings: Paid by tenant, including Land Tax & Property Management
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Address | Total GLA | Rent: $ / sqm 49-53 Plateau Road, Reservoir | Total GLA: 5,200 sqm | Rent: $125/sqm 10-18 Lucknow Crescent, Thomastown | Total GLA: 3,008 sqm | Rent: $145/sqm Warehouse 5, 21-35 Radford Road, Reservoir | Total GLA: 3,285 sqm | Rent: $163/sqm Warehouse 4, 21-35 Radford Road, Reservoir | Total GLA: 4,046 sqm | Rent: $165/sqm 7/11 Industrial Avenue, Thomastown | Total GLA: 3,370 sqm | Rent: $131/sqm 53-63 National Blvd, Campbellfield | Total GLA: 4,550 sqm | Rent: $140/sqm 309 Settlement Road, Thomastown | Total GLA: 9,875 sqm | Rent: $132/sqm 1/90-118 Bolinda Road, Campbellfield | Total GLA: 3,529 sqm | Rent: $165/sqm Warehouse G, 33-44 Raglan Street, Preston | Total GLA: 6,236 sqm | Rent: $135/sqm Building 9-11 Somerton Park Drive, Campbellfield | Total GLA: 8,017 sqm | Rent: $148/sqm 3A, 400 Mahoneys Road, Campbellfield | Total GLA: 4,183 sqm | Rent: $150/sqm 1-5 Wirrigirri Close & 57-61 Gawan Loop, Coburg North | Total GLA: 4,947 sqm | Rent: $145/sqm
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Purchase Price: $10,000,000<br>Net Yield: 6.5%<br>Net Rent: $125/sqm<br>Annual Rent: $650,000 + outgoings + GST<br>Rental Reviews: 4% annually<br><br>Net Rent per sqm: $125/sqm<br>Purchase Rate (on NLA): $1,923/sqm<br>Purchase Rate (Land): $1,404/sqm<br><br><b>Property Features</b><br>Land Area: 7,122 sqm<br>Building Area (NLA): 5,200 sqm<br>Site Utilization: 73% (no longer achievable under current building regulations)<br>Car Spaces: On-Site Parking Available<br>Frontage: Substantial Exposure with Easy Access<br>Signage: Opportunity for Brand Visibility in a lively Industrial Precinct<br>Fit-Out: <br><span style="color:rgb(51, 51, 51);font-weight:normal;">The owner has invested </span><span style="color:rgb(51, 51, 51);"><b>$7 million in 2020</b></span><span style="color:rgb(51, 51, 51);font-weight:normal;"> into</span><span style="font-weight:normal;"> a food-grade fit-out, fully equipped for food processing, storage, and packaging</span><br>Power & Gas Supply: Significant infrastructure in place for high-demand industrial operations<br>Lifts: No<br>Roller Doors: Yes<br>Zoning: Industrial 1 (IN1Z)<br><br>Potential uplift through Rethink Renewables - The high energy consumption would suggest suitablility to add solar + batteries to boost the yield further.
