[+] Urban Logistics Makes Massive Last-Mile Play

Sydney-based Urban Logistics Co has quietly lodged a development application to tear down the former Visy packaging facility and build 23 units across five warehouses on the 7.5ha site about 20km north of Melbourne. Assuming Hume City Council approves the Broadmeadows application, it will cap an extraordinary couple of years for the last-mile logistics provider. The 48,800-sq-m facility—almost double the size it is now—will become the 10th asset ULC is managing across 27 separate warehouses and currently occupied by about 45 clients in what is suddenly a billion-dollar-plus portfolio. All that has happened at breakneck speed. Founded in 2019, ULC is a joint venture between Wentworth Capital (formerly Alistair Nash’s private equity real estate firm NashCap) and a fund managed by the US investment giant BlackRock Alternatives. All those assets were acquired off-market—mainly through private sale and the company’s network of relationships—and all within two years, making ULC the country’s biggest last-mile logistics portfolio manager. And according to ULC’s chief executive Narelle Checchin, their strategy is showing no signs of slowing down. “We’re believers that there is a fundamental shift in the way consumers shop,” Checchin told The Urban Developer . “And there continues to be a large structural imbalance between available warehouse space and users needing to occupy space.” ▲ A render of Urban Logistics’ Altona North project. Commercial real estate services and investment giant CBRE believes an additional 1.8 million sq m of space will be needed in Australia , or twice as much as it currently has, over the next five years to accommodate the forecast growth of online shopping. A CBRE e-commerce trend and trajectory report late last year, which analysed the ongoing rise of the sector in Australia and its impact on commercial property, showed online sales rose from 9 per cent of total retail spending in 2019 to 14.3 per cent in July of 2022. Fuelled by shifts in retail habits during Covid lockdowns, online sales are forecast to reach 17 per cent of all retail spending by 2026. ULC is banking on that. “Online penetration rates are still far below the global average of 20-plus percent,” Checchin says. “We continue to think markets will still remain pretty limited around the availability of land and will clearly remain supply constrained. “We’re seeing the strength of it in the market, there is no available supply at the moment. Vacancy rates nationally are circa 1 per cent. I think in Melbourne they are sub-1 per cent. There’s just no stock out there and we’re seeing that in the strength of inquiry coming through.” Checchin, who came from the publicly traded property developer Mirvac to take on the ULC chief executive role in June of last year, says she wants to double their portfolio to $2 billion over the next five years. The main focus will be the critical shortages in Sydney and Melbourne. All 10 of ULC’s current assets are in Australia’s two biggest cities—seven are in Melbourne, three in Sydney. “But all those sites in Sydney are much larger, so by value we are equally weighted,” she said. ▲ A render of Urban Logistics’ Broadmeadows project. In a clear sign of ongoing shortages in the industrial and logistics sector ULC has no potential clients for their latest development. In documents before Hume council consultant engineers Pitt and Sherry said the L-shaped site on two parcels of land at 1-31 Riggall Street would be developed on a purely speculative basis. “Though customers have not been finalised, the proposed design is based upon tested client requirements and provides ready-made facilities for an immediate market response and anticipated occupation in 2024,” Pitt and Sherry principle Lucas Paterno wrote. CBRE research shows only about 35 per cent of Australia’s supply pipeline is speculative development, compared to other markets, such as the US, where more than 50 per cent is speculative. ULC acquired the former packaging plant from Visy Packaging Properties around March of 2020, paying $23.9 million. It fitted nicely with their strategy of targeting urban infill sites. “The key thing there is that the (Broadmeadows) site is currently underutilised,” Checchin said. “There’s 33 per cent lettable area on the site, so it gives us the opportunity to weigh about 25,000sq m of additional space at a time when there’s this increasing demand.” But it is ULC’s already-under-construction project 25km south-west of Broadmeadows and less than half that from Melbourne, about which Checchin is most excited. It’s here on a 10ha site in Altona North that ULC is juggling two existing clients across 40,000sq m as they retain the bulk of the current building while adding another 12,000sq m in what’s a complex adaptive re-use development. ▲ The Altona North project includes a substantial reuse of existing buildings on the site. ULC acquired the land at 30 Taras Avenue just before Christmas in 2020 for $55 million. “There were existing expiries in place, and we were able to negotiate to bring those forward so that we could kick off development a little bit earlier than what would have otherwise been possible,” she said. Stage One could be completed as early as October this year. Adaptive re-use has other immediate benefits. At a time when rising construction costs are showing no signs of easing , adaptive re-use saves money, but it’s the ESG credentials that come with the process, that Checchin is happiest about. She said they’ll save 2.7t of carbon dioxide for each tonne of structural steel that is reused. About 106t of CO2 will be saved from the re-use of existing precast concrete walls. They’ll add initiatives like solar, electric vehicle charging, rainwater harvesting and re-use, and the plans call for the planting of 230 trees. The new role at ULC is something of a full circle for Checchin who began her career project managing some warehouses for what was Australand Property Group, and now Frasers Property Australia. “My more recent role has been in retail development, but industrial is becoming a little bit more retail-esque,” she said. “When you think about the assets we work on, those infill assets for example, you're talking about estates that may have 20 small units as opposed to a large 40,000-sq-m single-tenant building out in the northwest. “So the profile of infill assets is quite different.” You are currently experiencing The Urban Developer Plus (TUD+), our premium membership for property professionals. Click here to learn more.

Industrial
Ralph Nicholson
Tue 14 Feb 23

[+] Urban Logistics Makes Massive Last-Mile Play

Get the full story.

Frustrated Industry Cautiously Lends Support to National Construction Code Fixes

Beyond the Grid: Australia’s Self-Sufficient City Revolution Gathers Pace

‘Faster than HDA’: Newcastle Slashes DA Approval Times in Half

Sunset Clauses Under Scrutiny as Class Action Costs Developer Millions

Perth Steel Dynasty Bets Big on Brisbane Pipeline

Behind the Deals: Brisbane CBD & Metropolitan Market Q1-26 Transactions

Sydney Olympic Park Master Plan 2050

In conversation with Paul Salter | Managing Director, Salter Brothers

2026 Hotel Developer Summit | Panel | Nigel Greenaway & Letitia Vitale

IRT Greenlit for 240-Bed Wollongong Seniors Project

Abbotsford’s Home of Skipping Girl Comes to Market

Multiplex to Build Sirona Urban Towers at WA’s Seaside Cottesloe

Frustrated Industry Cautiously Lends Support to National Construction Code Fixes

Residential Developer Summit 2026

Adelaide Developer Symposium

Urbanity-26 Conference

The Urban Developer Awards for Industry Excellence

Frustrated Industry Cautiously Lends Support to National Construction Code Fixes

Beyond the Grid: Australia’s Self-Sufficient City Revolution Gathers Pace

‘Faster than HDA’: Newcastle Slashes DA Approval Times in Half

Sunset Clauses Under Scrutiny as Class Action Costs Developer Millions

Perth Steel Dynasty Bets Big on Brisbane Pipeline

IndustrialRalph NicholsonTue 14 Feb 23

[+] Urban Logistics Makes Massive Last-Mile Play

Get the full story.

Frustrated Industry Cautiously Lends Support to National Construction Code Fixes

Beyond the Grid: Australia’s Self-Sufficient City Revolution Gathers Pace

‘Faster than HDA’: Newcastle Slashes DA Approval Times in Half

Sunset Clauses Under Scrutiny as Class Action Costs Developer Millions

Perth Steel Dynasty Bets Big on Brisbane Pipeline

Behind the Deals: Brisbane CBD & Metropolitan Market Q1-26 Transactions

Sydney Olympic Park Master Plan 2050

In conversation with Paul Salter | Managing Director, Salter Brothers

2026 Hotel Developer Summit | Panel | Nigel Greenaway & Letitia Vitale

IRT Greenlit for 240-Bed Wollongong Seniors Project

Abbotsford’s Home of Skipping Girl Comes to Market

Multiplex to Build Sirona Urban Towers at WA’s Seaside Cottesloe

Frustrated Industry Cautiously Lends Support to National Construction Code Fixes

Residential Developer Summit 2026

Adelaide Developer Symposium

Urbanity-26 Conference

The Urban Developer Awards for Industry Excellence

Frustrated Industry Cautiously Lends Support to National Construction Code Fixes

Beyond the Grid: Australia’s Self-Sufficient City Revolution Gathers Pace

‘Faster than HDA’: Newcastle Slashes DA Approval Times in Half

Sunset Clauses Under Scrutiny as Class Action Costs Developer Millions

Perth Steel Dynasty Bets Big on Brisbane Pipeline

Industrial
Ralph Nicholson
Tue 14 Feb 23