This article is from the Australian Property Journal archive
MELBOURNE industrial rents have risen by 0.7% in the Q2, bringing the total annual growth to 6.8%, supported by underlying demand from the import and retail trade sectors, according to CB Richard Ellis.
CBRE’s latest Asia Pacific Industrial & Logistics MarketView shows Melbourne is ahead of other cities, and double the 3.9% year-on-year rent growth recorded in Perth, which had the second highest annual growth, followed by Brisbane at 3.3%, Adelaide at 1.7% and Sydney at 0.9%.
CBRE industrial & logistics services senior director Dean Hunt said on a quarterly basis, rents were stable in most markets with the exception of Melbourne.
“Further assisting is the reduction in vacancy, which is creating greater competition for space and the beginnings of a re-emergence in the speculative development sector,” he added.
In Perth, rents remained stable in Q2 and business confidence has rebound.
Services senior director Warick Irving said companies directly or indirectly involved in the mining and resources sector are looking to expand and increase their industrial requirements in Western Australia.
“A lack of large, available properties for lease may be a driver of rental growth moving forward, although construction levels have begun to increase again after a period of stagnation. The main constraint will be the lack of larger parcels of suitably zoned land in Perth’s established industrial hubs,” he added.
In Sydney, the high Australian dollar is continuing to put pressure on local manufacturers and a number of large South Sydney tenants are moving to cheaper markets in the western suburbs.
In Brisbane there was little change in rents as the market continued to absorb existing stock and companies took longer to negotiate lease agreements. However, with the development pipeline having dried up, the report tips some upward pressure on rents for large facilities in coming months and re-emerging interest in design and construction options.
Industrial regional director Joshua Charles said development activity was picking up generally throughout the Pacific Region.
The report shows that whilst there was an overall easing in rental growth, demand for industrial properties largely remained firm. At the same time, industrial capital and land values moved fairly quickly in several Asian markets.
Values in the Pacific remained largely steady over the quarter, as financing remained tight.
The overall trend was for a slowing in rental growth throughout the region with the CBRE Logistics Rental Index rising by 1.4% quarter-on-quarter in Q2 compared to a 2.2% increase in Q1. There have been pockets of growth – particularly in markets such as Beijing and Chandu.
Australian Property Journal
