Logistics real estate stays in tenants’ favour

By: Ruza Zivkusic-Aftasi


Property expert advises those in Melbourne market to take advantage before Christmas

Logistics real estate stays in tenants’ favour
CBRE says avoid the Christmas rush

 

Melbourne’s logistics real estate scene continues to be a tenants’ market due to an oversupply of properties.

Trucking firms coming out of long-term leases are urged to shop around before the Christmas rush as the excess of transport and warehousing buildings leaves operators with plenty of options, industrial and logistics services real estate group CBRE manager Todd Grima says.

Those coming out of long-term leases are finding the market rental rates lower than usual due to appealing incentives over the last 18 months.

With the average lease being five to seven years, operators usually spend a year looking for a new location.

"We had a tenant last week looking for 6,000 to 10,000sqm building and we showed them 13 buildings all of which would be acceptable for them and their business," Grima says.

"It’s definitely a market where there’s an oversupply of options for tenants and it’s a good position to negotiate and get deals."

There’s been an increase of inquiries from the transport sector over the last two months due to the Christmas rush, he adds.

"Landlords are very aware that if they don’t get an occupier essentially before December 15 then the market goes quite dead until February.

"We definitely encourage any occupiers that are currently paying a rental excess of $75 per square metre or coming up to renewal or they’ve outgrown their existing facility to go into the market and see for themselves; it’s crazy what’s being offered to these tenants at the moment and I think they’ll be pretty surprised with what’s put on the table for them if they were to come to the market," Grima says.

Freight company Rohlig Australia has signed a new 10-year lease for an 8,730sqm purpose-built warehouse in Truganina.

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