An injection of public companies, professional services, and hospitality and showroom occupants are leading a white collar transformation of Melbourne's inner-north.

The historically blue-collar suburbs of Fairfield, Preston of Thornbury are managing to generate strong interest due to a mix of new and recycled buildings. 

Companies such as ISS Facility Services and Global Autocoat - both of which are listed company subsidiaries - have made the move to Fairfield in deals negotiated by Melbourne realtor Gray Johnson.

Gray Johnson Director Matt Hoath said the recent activity reflected a "changing of the guard" within the region.

"We're finding that the uses of the industrial sites in these areas are changing," he said.

"Everyone was predicting that industrial would come off but it hasn't because the retail playing field is different.

202 Grange Road, Fairfield. Source: Gray Johnson

"A lot of retailers don't need to be in a shopping strip, they just need a distribution centre.

"We are also getting more labs and higher quality offices being built than industrial sites."

The Fairfield commercial and industrial precinct was developed 50 years ago, with a large section previously occupied by a quarry.

Preston was developed into a major commercial precinct earlier than Fairfield and was dominated by the largest land-owner at the time, CIG (Commercial & Industrial Gases- now BOC Gases).  

Recently, it has become known for its office-leasing potential, with Omni Care leasing 1,680 square metres of space at the iconic Preston Corporate Centre at 110 Chifley Drive for $350,000 per annum.

Mr Hoath the former Optus building exemplified the shift in the area

"The area has changed from industrial to more of a commercial hub that is feeding off the Northland Shopping Centre," he said.

Gray Johnson also negotiated the deal which will see Moon Dog Brewery open at 32 Chifley Drive, Preston, later this year.

Mr Hoath said the trend was likely to continue, due mainly to a lack of good quality buildings available in the city fringe.

"There is a lack of stock, meaning it is almost recession proof."

"The land values have probably gone up about 15 per cent in the past 12 months to reach $1,800-2,000 per square metre.

"There is a bit of a knock on effect from all the warehouse conversions in Collingwood and Abbotsford, where land is $7000-8000 per square metre."

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