Fund manager Charter Hall has purchased the Melbourne manufacturing home Australia's largest provider of glass Viridian for $100 million which is set to be added to its Prime Industrial Fund.
The plant, which has acted as Viridian's headquarters since the 1960s is located on Greens Road in Melbourne's suburb of Dandenong South.
The property comprises 77,124sq m of gross leasing area, with multiple warehouses, office and ancillary buildings, a small cold store, drive around truck access and multiple parking areas.
The off-market transaction was brokered by JLL's Tony Iuliano and Adrian Rowse for the site which provides the ASX-listed property giant with 4.1 hectare of expansion land for future development.
Rising industrial land prices in both Melbourne and Sydney have driven an increased competition for a highly finite number of zoned sites close to urban centres and with good transport connections.
Amid the growth in e-commerce and consumers demanding faster delivery times many REIT's and investors are looking to position themselves before the Australian retail industry, worth $23 billion, equivalent to $1 in every $20 spent online, transitions into an unrecognisable commerce landscape.
“Industrial land holdings of this size within core infill metropolitan locations are becoming increasingly difficult to secure,” CPIF fund manager Richard Mason said.
Particularly within the Dandenong South industrial precinct which is currently seeing strong demand from industrial and logistics tenants.”
The site was listed in April after building products group CSR sold the Viridian Glass business to Crescent Capital Partners for $155 million last year.
Charter Hall will now take ownership over the site—one of the few remaining vacant land opportunities in Melbourne's south east zoned for industrial use—with Viridian set to continue their occupation of the property with an 8 year triple net lease.
Over the past five years, Charter Hall has undertaken more than $5 billion of sale-and-leaseback style deals across its platform with groups such as Telstra, Woolworths, Bombardier Transport, Bunnings, Coca-Cola Amatil, Inghams, and Peters Ice Cream.
Last month, Charter Hall raised an additional $725m for its Industrial Fund, enabling the capacity for it to grow its assets to over $5 billion.
The Viridian acquisition will increase the funds weighting to Sydney and Melbourne’s industrial markets to 64 per cent.