Savvy investors keen to milk the rampant demand for Australian baby formula will be sure to lap up a country Victorian development site that’s hit the market.
Local dairy groups and buyers from China are already eyeing the historic former Camperdown Cheese and Butter Factory, in Victoria’s southwest, which is up for grabs with approved planning permits for an infant formula and powdered milk production plant.
Industry sources expect the rare offering to fetch more than $5 million.
This listing comes amid an Australia-wide baby formula shortage, spurred by huge demand from China, which has forced supermarkets to implement two-tin purchase limits.
Global market research group Mintel recently found more than half of Chinese mums believed formula from Australia and New Zealand was superior.
CBRE’s head of agribusiness Danny Thomas said the Camperdown listing marked “the first time in the history of the Australian dairy industry that a property with a planning permit for a state-of-the-art milk powder facility has been offered”.
“It would normally take years to obtain permits for a facility of this magnitude in Australia,” Mr Thomas said.
“But with this site, (the buyer) can hit the ground running and be fully operational within a few years.”
Once the almost 6ha site at 325 Manifold St has been redeveloped, it will have the capacity to churn out up to 450 million litres of formula per year at a gross realisation value of about $200 million, according to selling agency CBRE.
The agency said the planned facility would produce and package baby formula on site, via two “powder milk spray dryers” capable of delivering tens of thousands of metric tons of bulk and nutritional power per year, and canning and blending equipment able to produce 64 million tins annually.
Chemical storage, a truck loading dock, tank farm, an office and administration building are also on the plans for the plant which, once operational, will create more than 70 new jobs and be able to run 24 hours per day every day.
Mr Thomas said the plans incorporated parts of the heritage cheese and butter factory — which began operating in 1891, making it one of Australia’s oldest dairy plants still in existence — into the new facility.
This included the facade of the building, in the heartland of Victoria’s dairy farming region.
The vendor, Polis Group, has owned the site for 16 years.
Expressions of interest for the property — which also includes two existing tenancies with a $152,498 annual income — will close April 18.