• Melbourne’s office leasing costs are the lowest on the eastern seaboard

    Prime grade office space in Melbourne is 29% cheaper than that in Sydney and 20% cheaper than Brisbane. 

    Melbourne's office leasing costs are $495/m2 pa, compared to $699/m2 pa in Sydney and $618/m2 pa in Brisbane.

    Prices are face value rents and are exclusive of incentives.

  • Industrial land costs Australian cities

    Melbourne’s industrial land prices are the lowest on the eastern seaboard

    For a land area of 1 to 5 hectares, Melbourne is 45% cheaper than Sydney and 20% cheaper than Brisbane. Melbourne's industrial land price is $184/m2, compared to A$333/m2 in Sydney and $230/m2 in Brisbane.

    Our location specialists are ready to help you with site selection  options, regulatory facts and building and planning approvals.

  • Electricity prices Australian states

    Melbourne’s electricity prices are the lowest on the eastern seaboard

    Melbourne is 11.5% cheaper than New South Wales and 30.1% cheaper than Queensland for a medium electricity user site of 1,000 MWh, with 50% peak and 50% off peak usage. Melbourne's electricity price is $137.38/MWh, compared to $155.27/MWh in New South Wales and $196.56/MWh in Queensland. Thriving competition of Melbourne's fully privatised electricity market is a win for businesses.

  • Gas prices Australian states

    Melbourne’s gas prices are the lowest on the eastern seaboard

    Melbourne is 39.2% cheaper than New South Wales and 68.5% cheaper than Queensland for a medium gas user site of 10,000 GJ pa. Melbourne's gas price is $7.82/GJ, compared to $12.86/GJ in New South Wales and $24.79/GJ in Queensland.

    In a fully contestable market, final pricing is subject to negotiations with the gas supplier.

Melbourne is a cost competitive destination for foreign and interstate investors because it offers the lowest gas and electricity prices on the eastern seaboard. 

Melbourne's office leasing costs are also the lowest on the eastern seaboard and is ranked fifth cheapest in the world for office space behind, Bangkok, Toronto, Auckland and Seoul. 

Melbourne's industrial land prices are also the lowest on the eastern seaboard.

Melbourne's office leasing costs are the lowest on the eastern seaboard

  • Melbourne is 29 per cent cheaper than Sydney and 20 per cent cheaper than Brisbane
  • Melbourne office leasing costs are A$495 per m2 per annum, Sydney's office leasing costs are A$699 per m2 per annum, and Brisbane's office leasing costs are A$618 per m2 per annum
  • Prices are face rents and are exclusive of incentives

Source: CBRE Research Q4 2015  

Melbourne's industrial land prices are the lowest on the eastern seaboard

  • For land 1-5 hectares:
    • Melbourne is 45 per cent cheaper than Sydney and 20 per cent cheaper than Brisbane
    • Melbourne's price is A$184 per m2, Sydney is A$333 per m2 and Brisbane is A$230 per m2
  • An example of a 1-5 ha industrial land user is data centre, pharmaceutical factory, food processing factory

Source:  Knight Frank Research, November 2015

Melbourne's electricity prices are the lowest on the eastern seaboard

(for companies using over 1,000MWh per annum)

  • For a  medium electricity user site of 1,000 MWh, with 50% peak and 50% off peak usage:
    • Melbourne is 11.5 per cent cheaper than New South Wales and 30.1 percent cheaper than Queensland
    • Melbourne price is A$137.38 per MWh, New South Wales is A$155.27 per MWh and Queensland is A$196.56 per MWh
  • An example of a medium electricity user is a medium food processing plant or a supermarket.
  • Prices are for retail electricity, inclusive or GST and in Australian dollars.
  • Invest Victoria commissioned Energy Advice to prepare a report comparing electricity and gas pricing of a variety of customers across Victoria, New South Wales and Queensland, that is, the eastern seaboard of Australia
  • The report benchmarked four types of electricity users based on consumption
  • EnergyAdvice was recently acquired by Energy Action a leading provider of Energy Procurement, a contract management & energy reporting and projects & advisory service

Source:  EnergyAdvice, Electricity and Natural Gas Independent Price Comparison Report December 2015 (commissioned by Invest Victoria)

Scenarios were created for four retail electricity user types based on consumption.

Retail electricity

User types

  1. User of 160 MWh pa with prices for 50/50 Peak/off-peak and 75/25 peak/off-peak
  2. User of 1,000 MWh pa with prices for 50/50 peak/off-peak and 75/25 peak/off peak
  3. User of 10,000  MWh pa with prices for 50/50 peak/off-peak and 75/25 peak/off peak
  4. User of 100,000 MWh pa with prices for 50/50 peak/off-peak and 75/25 peak/off peak 

Method

  • Analysis included five electricity distributors
  • Comparisons were made with metropolitan New South Wales and Queensland
  • Forecast costs are for the calendar year periods 2016 to 2018
  • Capital costs in relation to connecting to the electricity are excluded
  • Delivered costs are based on forecast for an existing site 

Assumptions

  1. Annual consumption is prorated on the basis of number of days in the month.
  2. Wholesale peak and off peak electricity rates & environmental certificate rates are as per the wholesale market as of 15th December 2015.
  3. Wholesale electricity rates are escalated by a retail margin of 15 per cent for 160 MWh per annum, 10 per cent for 1,000 MWh per annum, 7 per cent for 10,000 MWh per annum and 5 per cent for 100,000 MWh per annum.
  4. Environmental certificates are escalated year on year by an estimated cost of capital - 8 per cent.
  5. Proxy distribution loss factors (DLFs) & transmission loss factors (TLFs) are derived from the EnergyAdvice client database and are dependent on the size and location of the scenario.
  6. Metering charges are assumed as A$1,200 per annum for all sites.
  7. Distribution costs are based on the current distribution charges as at Dec 2015 uplifted for estimated future price increases.
  8. Network tariffs are selected as per the Min/Max thresholds based on consumption and demand.
  9. New South Wales & Queensland -  network charges are based on AusGrid & Energex areas respectively
  10. For Queensland - CAC & ICC (site specific tariffs) - we have used average rates for sites that are on CAC & ICC tariffs (EnergyAdvice database used for the sample sites).
  11. Load factors and power factors are based on the average of sites with consumption that matches the scenarios (EnergyAdvice database used for this analysis).
  12. All prices are GST exclusive and in Australian dollars.

Melbourne's gas prices are the lowest on the eastern seaboard

  • For a medium gas user site of 10,000 GJ per annum:
    • Melbourne is 39.2 per cent cheaper than New South Wales and 68.5 per cent cheaper than Queensland
    • Melbourne's price is A$7.82 per GJ, New South Wales is A$12.86 per GJ and Queensland is A$24.79 per GJ.
  • An example of a medium user would be a small-scale food processing plant
  • Prices are for delivered retail natural gas
  • Invest Victoria commissioned Energy Advice to prepare a report comparing electricity and gas pricing of a variety of customers across Victoria, New South Wales and Queensland, that is, the eastern seaboard of Australia
  • The report benchmarked three types of gas users based on consumption
  • EnergyAdvice was recently acquired by Energy Action a leading provider of Energy Procurement, a contract management & energy reporting and projects & advisory service

Source:  EnergyAdvice, Electricity and Natural Gas Independent Price Comparison Report December 2015 (commissioned by Invest Victoria)

Scenarios were created for three delivered retail natural gas user types based on consumption.

Delivered retail natural gas

User types

  1. User of 1,000 GJ pa (volume tariff)
  2. User of 10,000 GJ pa (demand tariff)
  3. User of 5000,000 pa (demand tariff)

Method

  • Analysis included three gas distributors in Victoria
  • Comparisons were made with metropolitan New South Wales and Queensland
  • Prices have been based on forward prices and environmental charges
  • Network tariffs, where applicable, have been included in forward prices

Assumptions

  1. Annual consumption is prorated on the basis of number of days in the month.
  2. Energy rates are as per the rates received from various retailer responses to procurement activities - average price is used.
  3. Fixed/transmission rates for New South Wales & Queensland are as per rates received from various retailers (converted to $ per max daily quantity per day) from procurement activities, average price is used; for Victoria, regulated prices are used.
  4. Energy and fixed/transmission rates are subject to CPI escalation. This is included where appropriate.
  5. The injection point into the VIC transmission system is assumed to be Longford.
  6. 60 per cent load factor is assumed for the 10,000 GJ scenario & 75 per cent load factor is used for 500,000 GJ scenario to calculate MDQs.
  7. 40 per cent load factor is assumed for 10,000 GJ scenario & 50 per cent load factor is used for 500,000 GJ scenario to calculate MHQ.
  8. Distribution costs are based on the current distribution charges as at Jan 2015 uplifted for estimated future price increases.
  9. New South Wales & Queensland network charges are based on Jemena only - DC-4 & Envestra Brisbane area respectively.
  10. Metering charges are assumed to be A$500 per month per site for the Victorian sites consuming 10,000 GJ & 500,000 GJ - New South Wales and Queensland metering charges are bundled into distribution charges.
  11. For the 1,000 GJ per annum scenario bundled retailer tariffs for each region have been applied.
  12. There is no allowance for additional charges that may be incurred for usage outside of the contract parameters.
  13. All prices are GST exclusive and in Australian dollars.