[+] Derailed: State Shunts Western Freight Mega-Hub

Victoria has shelved indefinitely plans for a major freight hub in Melbourne’s west that promised thousands of new jobs and growth for at least four councils. The State Government had enthusiastically supported the Western Interstate Freight Terminal (WIFT)—one of two giant freight hubs for outer Melbourne— since 2021 but now says it will be “deferred until it is needed”. Instead, the Allan government will come into line with the Federal Government, which favours the Beveridge Intermodal Freight Terminal, th other planned freight hub, this one about 40km due north of Melbourne. The Victorian decision is something of an about-face for the State that has long favoured the western terminal at Truganina—16km west of Melbourne—be delivered before Beveridge. In fact, when the then Morrison government committed just $740 million to WIFT in the 2022-23 Federal Budget, compared to $1.62 billion for the proposed Beveridge facility, Jacinta Allan said the western region needed the facility immediately and had to be the “first cab off the rank”. She was then the Minister for Transport Infrastructure. Now, the Victorian Government acknowledges “a few things have changed”. ▲ A render of the Beveridge Intermodal Freight Terminal. The Victorian Government now agrees it should progress ahead of one in Melbourne’s west. “The Western Interstate Freight Terminal remains a priority for our freight planning—and we’ll continue to protect the land at Truganina for an important future freight precinct,” a Victorian Government spokesperson said. “After the Commonwealth’s decision to prioritise the delivery of Beveridge Interstate Freight Terminal (BIFT), we have moved swiftly to ensure that rail freight operations at Dynon can provide sufficient capacity in the short-term. The government-run Dynon Rail Freight Terminal, on Melbourne’s western outskirts, provides intermodal container services for freight across Victoria and Australia. The Government says the extension of rail freight operations at Dynon from 2031 for up to 20 years is a key part of its strategy to ensure Melbourne continues to have the interstate rail freight terminal capacity it needs in the short-to-medium term. It says protecting Truganina for future freight development may also help unlock land for industrial development in the short term, something that has been welcomed by the Property Council of Australia. “While a delay to the delivery of the WIFT is disappointing, we strongly encourage swift decision making by government on unlocking land within the broader precinct to meet the industrial land supply crisis in Victoria,” Victorian executive director Cath Evans said. Share of Container Freight by Rail ▲ Source: ACCC calculation based on Bureau of Infrastructure and Transport Research Economics data However, she told The Urban Developer , it was critical to the state’s freight sector that in the long-term both the BIFT and WIFT be delivered. “Certainty, albeit with a delay, is better than the ongoing uncertainty the industry has been enduring, particularly if that certainty comes in the form of a fresh injection of new industrial land into the market—the sooner the better.” Cushman and Wakefield head of logistics and industrial research Luke Crawford was not surprised by the State’s decision on Truganina. Although a tight market in Sydney has caused industrial and logistics providers—particularly those online and bigger retailers looking for more space—to move to Melbourne’s west, he does not believe the prospect of an intermodal freight terminal was part of the decision. “Certainly, occupiers would have understood there’ll be a benefit once it (the freight terminal) was built, but I wouldn ’ t say it was the key factor in choosing the west or other markets,” he says. Longer term, says Crawford, it may be different. “About 60 per cent of Melbourne’s supply this year is in the west, so there is a bit coming online,” he says. “And most of that is on a speculative basis, whereby it’s been built with no tenant.” ▲ Intermodal freight terminals, coupled with the proposed inland rail, will allow for 1800m-long, double-stacked freight trains. Freight and logistics employ 1.2 million people in Australia who collectively help move 3.7 billion tonnes of product a year. That represents 8.6 per cent of the country gross domestic product. And it’s set to grow by 26 per cent by 2050. There are savings to be had from freight shipped via rail, rather than road. But although about 10.5 per cent of Australia’s current freight is moved by train, that figure drops to 6.1 per cent in Melbourne. Regardless, Melbourne remains the freight capital of the country and the Beveridge Intermodal Precinct will reflect that. With about 600ha of developable land, there is the possibility of up to two million square metres of warehousing. The rail journey for freight between Melbourne and Brisbane will be under 24 hours—12 hours less than freight by road. But most importantly, Beveridge will be the only Victorian intermodal capable of handling 1800m-long, double-stacked freight trains. Melton City Council would have liked to have seen that kind of money-generating infrastructure come its way. ▲ More than a third of Australian container trade enters via the Port of Melbourne. The Western Interstate Freight Terminal would have sat within Melton’s boundaries, and border on three other municipalities—Wyndham, Brimbank, Hobsons Bay. All four had actively campaigned for WIFT to be developed. Melton mayor Kathy Majdlik said the freight terminal would create about 1360 jobs during construction, 2000 ongoing jobs and be the catalyst for commercial investment leading to 28,000 jobs within the municipality. “The decision to defer the WIFT is extremely disappointing,” Majdlik said. “The opportunity to attract commercial investment to create quality, local employment is critical for our growing city. “The government must acquire the land to secure the WIFT’s future and plan the surrounding employment precincts to attract investment that will create thousands of jobs across Melbourne’s west.” The mayor said the freight terminal had strong industry support, would increase productivity, get hundreds of trucks off the road, create thousands of jobs and serve as a major catalyst for commercial investment. You are currently experiencing The Urban Developer Plus (TUD+), our premium membership for property professionals. Click here to learn more.

[+] Derailed: State Shunts Western Freight Mega-Hub

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