Perth industrial takeup hits 228,600sqm over the last year | Real Estate Asia
, Australia

Perth industrial takeup hits 228,600sqm over the last year

This is more than the 10-year average of 205,000sqm.

According to a JLL report, occupier demand in the Perth industrial market decreased over 4Q22, with 30,600 sqm of gross take-up recorded across four major occupier moves (≥3,000 sqm). Quarterly gross take-up was the weakest recorded since 1Q22.

Over the last 12 months, 228,600 sqm of gross take-up was recorded in the Perth industrial market, above the 10-year average of 205,000 sqm. Demand was led by the Transport, Postal & Warehousing (26.1%), Manufacturing (20.1%) and Wholesale Trade (13.2%) sectors. Pre-lease activity accounted for 36.0% of gross take-up in 2022.

Perth industrial supply pipeline is limited

No major developments (≥3,000 sqm) reached completion in 4Q22. Nevertheless, 78,800 sqm of new supply across six projects was added over the last 12 months. There are six projects totalling 71,300 sqm currently under construction and expected to be completed by 4Q23.

The supply pipeline is limited beyond projects already underway, with only one project with DA approval. New land holdings to the North and South of Perth may lead to an increase in pre-lease and design & construction activity in these precincts.

Rents increase across all Perth industrial precincts

Average prime existing net rents increased across all three precincts in 4Q22, marking the third consecutive quarterly increase in rents. Rents in the South precinct increased by 4.6% over the quarter, while the East and North precincts also recorded increases of 3.9% and 3.5% respectively. Annually, rental growth was the strongest on record across all three precincts.

Rising cost of debt pressures has slowed investor demand, leading to yield decompression for industrial and logistics assets. Prime yields decompressed by 25 basis points across all three precincts in 4Q22 to a midpoint of 5.25%. 

Outlook: Rental growth is expected to maintain upward momentum

Rental growth is expected to remain positive in the medium term, driven by strong demand and scarcity in supply. Nevertheless, with global economic conditions set to deteriorate in 2023, growth expectations are set to be softer.

Occupier demand is anticipated to remain elevated as long as broader economic conditions remain positive. The e-commerce sector is expected to continue to lead sectoral demand, driven by strong ongoing consumer spending tailwinds.

Note: Perth Logistics & Industrial refers to Perth's industrial market (all grades).


Follow the link for more news on

Join Real Estate Asia community
Since you're here...

...there are many ways you can work with us to advertise your company and connect to your customers. Our team can help you dight and create an advertising campaign, in print and digital, on this website and in print magazine.

We can also organize a real life or digital event for you and find thought leader speakers as well as industry leaders, who could be your potential partners, to join the event. We also run some awards programmes which give you an opportunity to be recognized for your achievements during the year and you can join this as a participant or a sponsor.

Let us help you drive your business forward with a good partnership!