German Grocery Giant Kaufland Begins Warehouse Construction in Melbourne’s North

Construction has commenced on one of Australia’s biggest ever distribution centres.

The new warehouse is located in the northern Melbourne suburb of Mickleham, not far from Sunbury, at the Merrifield Business Park.

The warehouse will supply to new stores for European grocery goliath, Kaufland, Germany’s answer to American chain Costco. Kaufland will concentrate its offerings around fresh produce.

The Kaufland warehouse is being built by Vaughan Constructions, a long-standing Australian builder, and is worth a total of $225 million. The distribution centre will be constructed from concrete hardstand, and take about two years to complete.

The warehouse is conveniently located a short drive from Tullamarine airport and a comfortable distance of 35km from Melbourne’s centre. It is also close to a major fruit and vegetable wholesale market in the northern suburb of Epping.

The distribution centre will cover 117,000 square meters, or 28 hectares, and will contain 130 loading docks.

The project will create 600 permanent jobs and is expected to attract new businesses which will become part of its supply chain.

Kaufland is a subsidiary of Schwarz Group and has a total of 1200 stores in seven countries. It is making its first entrance to the Australian market, and has three approvals for Melbourne stores to be built in Epping, Dandenong and Chirnside.

Kaufland is worth $100 billion and also has approvals for two sites in South Australia. It is considering opening a further three stores in Victoria’s Coolaroo, Oakleigh South and Mornington.

An Australian Kaufland site is 4000 square metres, about twice the size of an average Coles supermarket. But its European sites average at 27,000 square metres, with extra space for 400 parking spots.

Chris Telley, senior development manager for Vaughan Constructions, said that his firm entered into early contract processes with the developer in order to achieve “substantial savings” for Kaufland’s design. Kaufland is known for its low-cost builds.

Vaughan Constructions has also built for Aldi, Coles, Coca Cola, Kraft and many other well-known brands. It is currently building two centres for joint venture partners Mirvac and Blackstone in an industrial estate in Epping.

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