Rent Rise in Some Precincts in Strong Brisbane Industrial Market
A strong start to 2017 for the large-scale Brisbane industrial property market (over 5,000 sqm) has resulted in a slight increase in net rents in some precincts after declines over the past few years, says Ray White Commercial.
Ray White Commercial QLD Associate Director Industrial Transactions, Dan Costello, said the first 10 months of the 2016/17 financial year resulted in approximately 180,000 sqm being leased in the Brisbane industrial (over 5,000 sqm) market.
“This is ahead of the same period last year where demand for stock totalled 162,000 sqm,” he said.
“Australian TradeCoast and the Logan Motorway precincts have an increase in net face rents after declines over the past few years. In contrast is the continued reduction in rents in the Southern precinct. We have witnessed owners being more realistic and accept lower face rents rather than the consequence of vacancies which has hampered this market over the last few years.”
Dan Costello said the Logan Motorway precinct has overtaken the more established Southern region for both demand and net face rents.
“This location has the ability to provide purpose built facilities with excellent infrastructure connections which has resulted in a premium associated with this region,” he said.
“Currently average prime net face rents in Logan sit at $110 per sqm. These results have been relatively stable over the past couple of years representing growth of just 2.80 per cent over the past two years. The Australian TradeCoast has been the long term leader with average current prime net face rents of $125 per sqm. The Southern precinct has fallen out of favour over the last five years as new supply has been heavily concentrated in these two other locations. As a result, we have seen downward movement in prime net face rents. Current net face rents represent a decline of 3.19 per cent over the last 12 months to $91 per sqm.”