“But there has been an explosion of development, plus massive areas have been set aside for conservation and there is pressure to build houses.”
With most of the bigger sites already pre-committed or land-banked, Mr Ellis said there was only about two to three years of forecast industrial land supply remaining, based on current consumption rates.
He said the pressure on land supply would be alleviated to an extent when the Western Interstate Freight Terminal was completed in Truganina – opening up between 800 and 1000 hectares of land for industrial development – but this was at least four years away.
“Hence the price escalation in industrial land has been phenomenal,” he said.
The 725 Boundary Road site, which can support 35.9 hectares of office and light industrial facilities as well as 5.5 hectares of housing as per the Truganina Precinct Structure Plan (PSP), is expected to sell for more than $500 a square metre.
Five years ago, industrial land in Melbourne’s west was selling at just $100 a square metre, Mr Ellis said.
This price surge is good news for Melbourne’s Ruzeu family, who have owned the property for more than 30 years and used it as a farming enterprise.
It is being sold to settle the estate of Romulus Ruzeu. Beneficiaries with a claim on the property include his son Paul Ruzeu, a director of builder Mega Homes which collapsed in 2019.