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Why Malaga?
- The Prime Location
- Development Is Booming
- Business Growth and Expansion
- Growth Expansion
- Real Estate Facts
- Real Cost Benefits
- Statement of Support
- Economic Profile
Malaga is centrally located in the eastern suburbs in a light, clean industrial area offering larger areas for expansion at affordable rates. The advantages of development and relocation to Malaga have been recognised with more than 48% of businesses specifically relocating because of its “prime location” (October 2004 survey). Malaga is business with location:
- Just 12 kilometres from the Perth CBD.
- 15 minutes from Kewdale interstate road/rail freight terminals and domestic and international airports.
- Quick and easy access to Reid and Tonkin Highways and the Mitchell Freeway.
- Close to other industrial areas including Bayswater, Kewdale, Balcatta, Bassendean, Wangarra and Osborne Park.
- Huge catchment of residential consumers on the doorstep.
- Close to a large labour pool.
Malaga is rapidly becoming one of Perth’s major industrial areas with huge projected growth:
- More than 2,000businesses currently exist in Malaga compared to 809 in 1997
- Some 10,000 people work in Malaga now, compared to 5,211 in 1997
- Choice exists for factory, warehouse and block sizes at costs lower than elsewhere.
- Since it was established in the mid 1980’s, business development in Malaga has increased by an average of 58% a year.
Source: (Burgess Rawson Property Consultants 2001, City of Swan 2002) Malaga has become one of Western Australia’s best commercial and industrial suburbs. There is potential to double the investment opportunities in the area. Business growth in Malaga will continue with increasing international exposure from many companies associated with worldwide activities. Sale and rent of land and business locations provide good investment potential. Prime business locations are currently offered. Industry clusters usually provide a financial and economic incentive for companies located in close proximity to Malaga. Many such clusters with numerous businesses are emerging to take full advantage of the synergies. For example:
- Manufacturing related businesses in Malaga account for 31.0% of all businesses;
- Automotive related businesses in Malaga account for 11.0% of the business population, and wholesalers 12.6%.
There has been high demand for land in Malaga in the past 12 months as it is the most active industrial suburb in Western Australia. Since the Malaga Freeway Industrial Estate released stage 5 in May 2002, all lots have been sold in that stage. Many purchasers believe Malaga is a strong alternative to Osborne Park. This is supported by Malaga’s growth, market acceptance, and presence of major companies in an emerging high profile industrial location. The high rating reflects Malaga’s proximity to freeways and main roads and street affordability. Its General Industrial zoning and location viability makes an attractive industrial area with the potential for future expansion. “Our research department revealed in its survey of industrial land users that Malaga rated in the top three as an ideal location” Burgess Rawson Property Consultants 2000
The Surging Northern Industrial Region
Northern Industrial region is experiencing the strongest growth in all parts of the market (leasing and sales) for the past 10 years.
Market forces such as the continuing low interest rate environment and strong business confidence are in play.
Two main drivers that shape the growth in this region are the resource sector boom and lack of reasonable land supply.
The lack of supply and increased demand has pushed land values up by a level not seen since the 1980’s. For the past 18 months, land and building values in the northern region had increased by approximately 20% to 50%.
Owner occupiers continue to be the main driving force of the market. Aside from the owner occupiers, recent activities show keen cashed up investors buying industrial properties at all time low yields. Modern industrial buildings under $1 million are showing yields in the 6.5%-8% range as investors profit take out of the residential property market. Investor confidence is based on recent strong capital growth and relatively low vacancy rates in the industrial sector of the market.
Based on current market conditions, the estimated length and prosperity of the northern industrial market is directly linked to the development of the resource sector, in which market analysts hypothesize will be approximately a two-year surge.
The future looks bright for industrial land owners.
The following table shows Malaga's position in Perth as one of four top industrial suburbs for 2006:
| Top Industrial Suburbs in 2006 | ||
| Last 10 Years | Based on 2000 sqm | |
| Osborne Park | 1995 - 2005 | $150 - $485 approx |
| Balcatta | 1995 - 2005 | $100 - $350 approx |
| Malaga | 1995 - 2005 | $60 - $250 approx |
| Wangara | 1995 - 2005 | $50 - $190 approx |
| Top Industrial Suburbs in 2006 | ||
| Last 10 Years | Based on 4000 sqm | |
| Osborne Park | 1995 - 2005 | $110 - $450 approx |
| Balcatta | 1995 - 2005 | $105 - $300 approx |
| Malaga | 1995 - 2005 | $50 - $210 approx |
| Wangara | 1995 - 2005 | $40 - $175 approx |
Balcatta 1995-2005 ($/sqm)
-Demand for vacant land is high
-Showroom supply good – new products being built
-Upward movement in sale and leasing rates in general
Osborne
-Leasing rates up by 15%
-Modern premises for sale or lease in strong demand
-General property demand high – prices rising
Malaga 1995-2005 ($/sqm)
-Leasing rates up by 10% - 15%
-Strong sale demand across all sizes
-Vacant land supply is very low & demand is very high
Wangara 1995-2005 ($/sqm)
-Land values up
-Strong owner/occupier demand for business expansion
-Leasing demand is up
-Leasing rates up by 10%
Source: Burgess Rawson Property Consultants, Associate Director-Chad Henville. Dec 2005
Malaga offers opportunity for expansion. In comparison to other similar metropolitan industrial regions, lease and rent rates are lower in Malaga.
| Malaga | $40-$50 per m2 net |
| Balcatta | $45-$55 per m2 net |
| Osborne Park | $45-$70 per m2 net |
- Land Values
| Osborne Park | Balcatta | Malaga | |
| 1000 m2 | $375-$450 m2 | N/A | $120-$140 m2 |
| 2000 m2 | $325-$375 m2 | $250-$275 m2 | $115-$125 m2 |
| 4000 m2 | $280-$300 m2 | $200-225 m2 | $90-$105 m2 |
| 10000 m2 | $200-$225 m2 | $125-$150 m2 | $85-$90m2 |
The City of Swan recognises and encourages generation of wealth, employment opportunity, education and low cost of living for quality of life. As the largest industrial area in the City of Swan, the workforce and businesses in Malaga will play a vital role in the economic development of the Swan community and ultimately improved quality of living.The City of Swan is committed to liaisons with business and community groups to ensure Malaga’s economic and industrial success. Ongoing programs identify the requirements for marketing and profile, rates, level of service, security and other key issues. The City of Swan also encourages and supports the emergence and economic success of a suburb in which there is co-location of diversified businesses and industries. The City of Swan is committed to Malaga’s success and supports the locality through attention to:
- Landscape improvementsThe introduction of a 5-year landscape improvement project, which aims to upgrade existing entry signs, beautify verges and median strips, plant street trees and develop public open space.
- Traffic management prioritiesRoundabouts and traffic lights have been installed under the Federal Government’s Road Black Spot Program, with traffic continuing to be a priority.
- MarketingMalaga will be marketed at a local, national and international level through the development of a regularly updated website and feature articles in business publications.
- Planning issuesThe City of Swan actively encourages prospective applicants to talk to planning staff before lodging a development application. This can often cut down on approval time. Design flexibility and the zoning scheme allow for a broad range of uses within the Malaga industrial area.
- Future plansThe City of Swan has recently introduced main trunk services to land east of Malaga Drive, paving the way for the final stage of development.
Swan will continue their pro-active role through facilitation of business initiatives and support for progressive businesses facing the challenge of serving a local and international region.
To reinforce its commitment to Malaga, the Cityof Swan appointed a Business Development Officer for the Area in February 2003. He can be contacted on 08 9 2499535 or email jrogers@swan .wa.gov.au
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Malaga is an industrial suburb providing an excellent location for light industry and service establishments. It is the major industrial suburb for the City of Swan and is designated a Strategic Industrial Area for Western Australia.
Located in the southwest corner of the City of Swan and covering almost 660 hectares (City of Swan, Intramaps, 2005), Malaga is surrounded by the suburbs of Ballajura, Whiteman, Beechboro, Noranda and Mirrabooka. Its location provides direct access to the Reid Hwy and easy access to the Mitchell Freeway, Wanneroo Road and the Tonkin Hwy.
Malaga is centrally located in the eastern suburbs, just 12 kilometres from the Perth CBD and 15 minutes from Kewdale interstate road/rail freight terminals and the Perth Domestic and International airports. Major transport networks nearby include:
· Reid Highway
· Tonkin Highway
· Mitchell Freeway
Alexander Drive separates Malaga from the residential suburb of Ballajura. It is close to other industrial areas including Bayswater, Kewdale, Balcatta, Bassendean, Wangara and Osborne Park. Surrounding suburbs, including Ballajura, Beechboro and suburbs within the City of Wanneroo provide a large and accessible labour pool and residential consumers.
These factors are an attraction for businesses choosing to establish or relocate themselves to an area with a prime location.
Development and Employment
Malaga was established in the mid 1980’s as an industrial area. Over the past 25 years the industrial complex has grown to accommodate more than 1700 businesses in 2004. On a similar front the number of business activities taking place between 1990 and 2001 has increased from 740 to 2815, a 280% increase in just over 10 years.
In 2001 the top three business activities conducted in Malaga were:
1. Service Industry 14.5%
2. Office / Business 14.3%
3. Storage & Distribution 13.6%
*Note: Vacant Floor Area accounts for 23.1% and Vacant Land accounts for 9.5%*
(Commercial & Industrial Land Use Survey 2001-02, Research Branch – Department for Planning and Infrastructure)
Malaga is Swan’s second largest employment centre, behind Midland, employing over 7,500 people in 2001 (12.3% of the City of Swan’s employment).
Business Growth
There is the potential for business growth expansion, especially with such competitive lease rates or purchase value on property. Malaga is destined has become one of Western Australia’s best commercial and industrial suburbs with huge projected growth and increasing national and international exposure from many companies with worldwide activities.
As the largest industrial area in the City of Swan, Malaga is set to play a vital role in generating business, wealth and employment for the local community. Opportunities exist for businesses to take advantage of the synergies associated with industry clusters.
Economic Growth and Industry Information
According to the Commercial and Industrial Land Use Survey, conducted by the Department for Planning and Infrastructure
Land Zoning
Most of the land within Malaga is zoned for ‘Commercial and Industry’ uses (80%). The remaining 20% is shared between ‘Parks/Reserves/Public Open Space’ and excluded areas (specifically roads). There is no zoning for residential activity. Redevelopment and subdivisions of commercial and industry land lots are expected to generate significant new economic activity for Malaga and the City.
Availability of Land and Floorspace for Commercial and Industrial Complexes
In the 2001/02 Commercial and Industrial Land Use Survey (DPI), 161,399m² of vacant floorspace was recorded in Malaga representing a vacancy rate of 18%. Total floorspace including occupied and vacant, increased by 79% from 486,995m² in 1997 to 871,473m² in 2001.
The number of establishments (trade names) grew significantly between 1990 and 2001. In 1990 a count of 290 establishments was recorded this has grown to 1368 in 2001. This reflects continuing growth for industrial and business activity within Malaga. (Commercial & Industrial Land Use Surveys, 1990, 2001-02, Department for Planning and Infrastructure).