CBRE is predicting huge rises in logistics demand in Adelaide and Perth due to the construction of the nuclear-powered submarines (SSNs) as part of AUKUS.
AUKUS is a security partnership signed by Australia, the United Kingdom and United States, which includes the manufacturing of submarines in Australia.
Adelaide’s Osborne Naval Shipyard and Perth’s HMAS Stirling naval base will both be key sites in the submarine manufacturing process, with CBRE predicting over a million sqm of logistics and retail space will be required to house the operations.
“Manufacturing of this type is very logistics intensive, creating a number of large-scale opportunities to redevelop real estate to support the infrastructure associated with AUKUS,” CBRE Pacific Head of Research Sameer Chopra says.
CBRE estimates 850,000 sqm of this increased logistics demand will fall to the suburbs and areas surrounding the Osborne Naval Shipyard, which is where the construction of the submarines will take place.
That increase is the equivalent of roughly 10 years of historical supply in the region.
Perth naval base HMAS Stirling is estimated to require a further 150,000 sqm of logistics space, which is equivalent to just over one year of historical supply.
The construction and operation of the submarines near major population hubs will also see the need for residential, office, childcare and retail spaces boom to support the increased population in the area for the project.
The Osborne Naval Shipyard was established in 1987 and is Australia’s most advanced shipbuilding facility and is located less than 30km by road from Adelaide’s CBD.
HMAS Stirling is located on Garden Island off the west coast of mainland Western Australia, however is reachable via the Garden Island Causeway and is just over an hour drive from Perth’s CBD.
Chopra says construction of new logistics, retail and residential sites needs to be close to the two booming destinations.
“Ideally, new apartment construction is within easy commute of these emerging large scale employment destinations,” Chopra says. “This should also be supportive of residential values in close proximity suburbs.”
Construction on the first AUKUS SSN is expected to commence by the end of the 2020s and be delivered to the Royal Australian Navy in the early 2040s.
Read more ATN:
Kenworth, Isuzu continue truck sale market dominance
Truck driving one of world’s unhealthiest professions
SingPost fully divests Australian business