With average key industrial rents across Brisbane remaining steady in the first half of 2018, (currently sitting at an average of $115/m2-$120/m2), it’s a good time to invest in industrial property. If you’re looking to buy or lease an industrial property, here are our top tips for 2019.
Brisbane’s Australia TradeCoast never gets old and has the largest supply of future industrial land in the region. It is of course, well positioned with a strategic government industry partnership, multiple transport links, and world-class infrastructure. The massive area at the mouth of the Brisbane River is backed by four powerful industry leaders and features average prime capital values at between $1,300/m2 and $2,300/m2. TradeCoast yields are attracting between 6.25% and 7.25% for prime sites. The TradeCoast area’s contribution to the Queensland economy is anticipated to surge to $9.4 billion by 2026.
The Caboolture region has seen some great activity in recent months, with the scarce amount of industrial land in the inner northern reaches of Brisbane. The northern precinct is becoming highly sought after and is quickly becoming a hotspot for industrial spaces. Because the region is well-established, the relocation of inner-city businesses is putting the areas into a flourishing boom. There are many exciting development opportunities for both strata-title complexes and freestanding warehouse space alike, and with the strong occupation of existing buildings and a lack of new land for development, vacancy rates are very low.
Traditional industrial suburbs like Virginia, Geebung, Banyo and Northgate and Banyo have close to zero stock available for the foreseeable future, leaving Caboolture, Deception Bay and Narangba as the go to spots for new development. The Northern Corridor from Brendale and up to Redcliffe, is flooded with small strata title industrial units and freestanding warehouse and office blocks, making it attractive to businesses of all types.
With principal activity focus in areas like Bundamba, where the development approval of a large industrial site where Costco will build their warehouse, the western precinct is predominantly made up of large distribution warehouses and manufacturing plants. Long-term, suburbs like Bremer, Ebenezer, Swanbank and Redbank are predicted to be key areas for imminent development opportunities. The continuance of strengthening in the area encourages investment by providing strategies to cope with development and population growth.
Prime capital values in the western industrial precinct have endured steady $1,300/m2 to $1,750/m2 since mid-2017, with average lease rates between $95/m2 to $115/m2. With investment yields between 6.25% and 7.00% for prime buildings and 8.75% and 9.50% for secondary, the area is not slowing down any time soon.