Surge in transport-focused property development


Burgeoning retail investment is pushing a similar uptick in transport and logistics real estate

Surge in transport-focused property development
Demand for warehousing space and transport facilities is on the rise.

 

An awakening retail sector is fuelling increased demand for logistics and warehousing facilities in Australia’s capital cities.

Commercial property agent Colliers International says this is to be expected whenever new investments in retail space take place.

"As our retail spending increases, the need to ship retail goods from offshore and domestic producers to shopfronts and the homes of consumers increases," managing director of Colliers’ industrial property practice Malcom Tyson says.

"This has a direct impact on the demand for industrial property, as the industrial floor space required to warehouse and manage the logistics for these goods increases accordingly."

The Australian Bureau of Statistics has found retail trade increased by 0.3 per cent during May, contributing to an annual rate of growth of 4.7 per cent – the strongest seen since pre-Christmas last year.

Part of the increase has come from a number of international retail brands investing in new operations in Australia – each with their own requirements for logistics services.

"While manufacturing has decreased in Australia, the transport and logistics sector has taken over as the major occupier of our sheds," Tyson says. 

"These occupiers are looking for facilities with 24-hour truck access, locations on major road infrastructure, and [large amounts of] space. 

Typically their requirements are in excess of 10,000 square metres, and often range up to 70,000 square metres."

Over the 12 months to the end of May, transport and logistics-focused tenants signed 42 per cent of the all new industrial leases around Australia.  

That represents a surge taking place this year specifically – the figure for the full year of 2014 was 33 per cent.

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