“The Adelaide market recorded a relatively significant rise in take-up—the largest volume since the fourth quarter of 2018.”
In Brisbane, the Charter Hall Prime Industrial Fund recently completed a new facility for a major global logistics company and signed new leases with Amazon and Australia Post at the TradeCoast Industrial Park in Pinkenba.
The acceleration of e-commerce has been driving demand for urban infill locations.
Australia’s e-commerce penetration has now reached a record 12 per cent as of August—a significant jump from 9.3 per cent in January.
JLL said rental growth has been stronger for inner-ring locations across major markets in Australia.
JLL’s Tony Iuliano said global capital will continue to be attracted to Australia’s industrial investment markets due to the country’s “safe haven” status, relatively resilient economy, dynamic industries and high innovation and skills.
“Investment appetite for the industrial sector has been consistently strong over 2020, which is maintaining competition and accelerating the upward pressure on pricing relative to commercial office markets.
“With manufacturing accounting for more than 20 per cent of gross take-up of industrial space in Melbourne and Sydney over the past 10 years, the announcement in the federal budget of the $1.5 billion Modern Manufacturing Strategy will add to growth of industrial and logistics space in both states,” Iuliano said.
According to recent findings from Colliers International, Sydney’s capital values for industrial property lifted to $2,732 per square metre in the third quarter of the year, from $2,700 in the first quarter.
Over the same period, prime Sydney yields tightened to 4.66 per cent from 4.75 per cent.
Melbourne industrial capital values rose 6 per cent between the first and third quarter of the year to $1,733 per square metre, while prime yields tightened by 31 basis points to 5.25 per cent.