WOOLWORTHS new 3.8-hectare distribution centre in Melbourne’s west has been completed, to be used by the major supermarket for its fresh produce, meats and chilled products.
Built by Vaughan Constructions, the $135 million facility is located within Charter Hall and Commercial & Industrial Property’s Drystone Industrial Estate in Truganina.
It includes 27,270 sqm of temperature controlled warehousing, 5,678 sqm of ambient warehouse, 2,700 sqm of office space, a 4,442sqm multi-level car park and 61,000 sqm of hardstand including loading docks, truck parking, and truck wash and maintenance areas.
It has a 5 Star Green Star rating that incorporates a 1.5 megawatt solar system, electric charging docks for trucks, drought tolerant landscape and irrigation system, double glazing, reclaimed and recycled concrete, bike parking and repair facilities, and a 155,000 litre water tank.
Woolworths joins Target and The Reject Shop, among others, within the $300 million, 90 hectare estate.
The facility is connected by an air bridge and automated conveyor system to Hilton Foods Australia’s MeatCo facility next door, which will enable meat to be cold-stored in the new Woolworths facility before being delivered to supermarkets.
Vaughan also delivered the 27,000 sqm Hilton Meats facility – formerly owned and operated by Woolworths – and Woolworths’ 70,000 sqm, $560 million distribution centre and corporate office at Lyndhurst in Melbourne’s south east (also constructed on a site owned by Charter Hall).
Vaughan Constructions Director, Eric Law, said the new custom-designed Truganina facility, which replaces Woolworths’ current operations at Mulgrave, will provide the leading national retailer with a market edge in terms of supply chain dynamics.
“The close proximity and connection to Hilton Meats next door, and to produce markets, will ensure Woolworths produce will be delivered faster and more efficiently to stores right across Victoria,’’ Law said.
Amid the battle for logistics supremacy in the supermarket sector, Woolworths is currently the subject of an Australian Competition and Consumer Commission review for its proposed $552 million acquisition of a 65% interest in the country’s second largest player in the food services market, PFD Food Services.
The deal includes $249 million to acquire 26 distribution centres that will be leased back to PFD. Critics suggest Woolworths is moving into a business-to-business space in which it would supply products to other businesses, including event centres and aged care and retirement homes.
The deal would also mean a combined logistics network and fleet that enhances Woolworths’ store range localisation and route and capacity optimisation, while PFD will have access to Woolworths’ logistics, digital and data analytics and operational capabilities.
In formal opposition to the proposal, Kate Carnell, The Australian Small Business and Family Enterprise Ombudsman, wrote to the ACCC that allowing the deal would be a “real kick in the guts” for smaller food distributors.
“Woolworths has been a beneficiary of COVID restrictions, with its supermarket operations seeing a significant upswing in sales, while independent food distributors have struggled. Allowing Woolworths to buy PFD would significantly improve its competitive position against other smaller supermarket operators.”
Woolworths’ major rival Coles recently announced it would increase its gross operating capital expenditure to $1 billion, including increased investment at its Witron ambient automated distribution centres.
In May, Coles signed long-term pre-lease commitments for two new facilities in Sydney and Melbourne to cater to its online retail business.
