Industrial Property – The Flavour of the Month

IT WOULD SEEM the growth in eCommerce is creating a surge in speculative Warehouse development. And along the east coast, the volume of new space to 30 June has exceeded that for the whole of 2018.

During last year, there was 422,000 sqm of speculative development. And yet there has already been over 550,000 sqm of space built so far this year.

And the appetite by major investors doesn’t seem to be slowing.

As you see, last year, Sydney was the out. But so far this year, Melbourne seems to be gaining ground – expecting to reach record levels by the end of 2019.

Distributors, logistic firms and certain retailers are eager to improve their efficiency levels … pre-committing to around half the space coming on stream.

Bottom Line: This is great news for those of you already holding Industrial property. However, for any investors looking to enter the market, you should probably proceed with some caution – because the market is becoming a little overheated.

The Era of Multi-storey Industrial Development

AS INDUSTRIAL land becomes scarce and more expensive, you will begin to see more multi-story warehouses emerge.

The first such major project is about to start in Revesby, in Sydney’s west.

George Potter and Singapore developer Roxy-Pacific are embarking upon a $50 million project of over 8,000 m² – comprising 44 industrial and office units over two floors. Plus, 90 self-storage units at basement level.

It’s being driven by the rising cost and short supply of suitable land close to the Sydney CBD.

Bottom Line: This approach is quite normal throughout Asia – where there are a few suitable sites close to urban areas. And it will become more common here in Australia – with online retailers wanting to have their warehouses close to customers, for speedy delivery.

Capital City Office Markets

THE CBD VACANCY rate for Sydney currently sits at 4.1%. And for Melbourne, it’s now at 3.8%.

As you would expect, overseas events have caused some hesitancy in the market. And the Sydney CBD can be rather sensitive to the global economy.

That said, recent reports show local business confidence growing – with stability appearing to return, after the recent election. [Read more…]

Likely Impact of the US/China Trade War on Property

ACCORDING TO JP MORGAN, the expected trade war should only shave about 0.07% off Australia’s GDP over the next couple of years. [Read more…]

The Pendulum Has Swung

WHAT AN AMAZING election result … although, I had always felt it would be a lot closer than everyone thought. Now many people are now asking how the pollsters could have got it so wrong?

In actual fact, they weren’t that far out. Rather, it was more a heavy bias in media coverage which fanned the Labor fever.

So, How DID the Coalition Manage to Win?

[Read more…]

A Quick Snapshot of the Commercial Property Market

RECENT RESEARCH conducted by CBRE has confirmed that investors preferred Melbourne over the other capital cities – based upon the strong fundamentals driving rental growth. [Read more…]

Australian CBD Office Market

THE PROPERTY COUNCIL of Australia recently released their Office Market Report for the six months ending January 2019.

Both the Sydney and Melbourne markets have been the strong performers. Although, most capital cities have also seen an improvement in their vacancy rates. [Read more…]

6 Key Pillars for Commercial Property Success

AS YOU WILL APPRECIATE, there is a fair amount of information you need to know about Commercial property. Although fundamentally, all that rests upon just six Pillars.

Once you understand that, everything else starts to make a lot more sense.

So, let’s perhaps take a few moments to briefly explore those Pillars. [Read more…]

Where in the Cycle are the CBD Office Markets?

EVERY INVESTOR would like to be in a position to pick the top and bottom of each Cycle, when it comes to commercial property.

And if you had followed things closely during last century, you would know forecasting this used to be relatively straightforward  with all the various Office markets following a fairly predictable sequence, as shown below. [Read more…]

Capital City Office Markets Around Australia

AS I EXPLAIN to my Mentor group, there is a certain rule of thumb for Office market vacancies around Australia.

And it’s really quite simple: For an office market to be “in balance” you really need to have a vacancy rate of between 6% to 8%.

It’s a bit like the unemployment rate. You see … a 5% unemployment rate – effectively means FULL employment – because anything lower than this … is starting to put pressure on wages. [Read more…]

Previously Hidden Markets Are Starting to Emerge



A RECENT SURVEY conducted by CBRE has revealed growing investor demand for industrial property – at the expense of the retail sector.

This would appear to be mainly driven by the increasing need for warehouse space by online retailers – and in particular, Amazon. [Read more…]