Kumho Tyre Australia signs 10-year lease in Pakenham

Kumho Tyre Australia has signed a 10-year lease for a 17,250-square-metre industrial facility in Pakenham, Victoria, increasing its storage capacity by 60%.

The new Endeavour Road site, developed by ESR, will serve as a distribution facility for the tyre supplier's Australian operations. TMX Transform managed the property procurement process for Kumho, which has operated in Australia for more than 40 years and distributes more than 1.8 million tyres a year.

The relocation follows demand outgrowing the capacity of Kumho's previous facility. The Pakenham warehouse includes six new dock provisions and a suspended 12.2-metre ceiling designed to meet compliance requirements for tyre storage. An upgraded fire system was also added as part of the fit-out.

Melbourne's outer south-east has attracted growing interest from industrial occupiers as rents and outgoings in the city's core south-east corridor remain elevated. Kumho's move to Pakenham reflects that trend, as tenants increasingly weigh lower property costs against greater distance from central locations.

Workforce considerations also influenced the decision. According to Kumho, the Pakenham site is closer to where staff live and should reduce commuting times compared with its previous base.

Kumho supplies tyres to national retailers including mycar, Tyrepower and Bob Jane T-Mart, as well as through its own Platinum and Master Dealer network. The Australian business employs more than 100 staff and forms part of the broader Kumho Tyre group, which operates in more than 180 countries.

Growth pressure

The warehouse deal highlights pressure on distributors to secure larger, more specialised facilities as inventory needs rise and industrial supply remains tight in established logistics corridors. For tyre distributors in particular, building compliance, fire protection and truck access can heavily influence property decisions.

"This new facility reflects the scale we've built in Australia over more than 40 years and gives us the space and infrastructure to support that growth well into the future. Investing in our own distribution network has always been central to how we operate here, and Pakenham strengthens that further so we can keep tyres moving efficiently to our retail partners across the country," said Alan Knight, State Manager, Victoria/Tasmania, Kumho.

Additionally, he added, "the location also makes a real difference for our team, cutting down travel time for staff and supporting the people behind our operations day to day." 

Property shift

Industrial property advisers have noted a broader shift towards fringe and outer-market locations as occupiers balance transport links, labour access and occupancy costs. Pakenham, in Melbourne's south-east growth corridor, has benefited from that shift as larger-format sites become harder to secure closer to the city.

TMX Transform said the search focused on operational requirements as well as cost. Daniel Kelly described the pressures involved in identifying a suitable facility.

"Kumho needed a site that matched its growth plans while addressing operational challenges around storage and truck movements. We are proud to have helped solve those challenges while using the new site's location to secure significant rent savings," said Daniel Kelly, Director of Property, TMX Transform.

"This facility offers the scale and compliance-ready specifications Kumho needed. We're delighted to have helped deliver a warehouse that sets the business up for the next stage of growth," he further shared.