Set to be the largest of its kind in Australia, work has started on the 71,000 square metre facility on 20 hectares next to Melbourne Airport.
Toll Group Managing Director Brian Kruger said the investment will help increase the company's online parcel delivery service, Toll Consumer Delivery.
“The custom-designed facility, with its highly specialised sortation system will triple our current parcel sorting capacity in Melbourne to an unprecedented 35,000 parcels per hour,” Kruger said.
“Given the growth we’re seeing in online retail, it is important we continue to improve our already-extensive national network to make it second to none.”
Kruger said the facility will help to improvesafety, fleet productivity, parcel sorting speed and accuracy, and energy and cost efficiencies.
“It is Toll’s willingness and ability to invest in state-of-the-art facilities and technology that makes it the industry leader in the express parcel delivery market," he said.
The new facility will employ over 500 people and is expected to be operational by the end of 2015.