Perth to see five new industrial projects by 2027

The projects will yield over 71,000sqm of new industrial space.

According to a JLL report, five major industrial developments (≥3,000 sqm) were completed in Perth over Q4 2024, totalling 40,100 sqm. In addition, five other projects totalling 71,200 sqm are under construction, with expected completion by end-2027.

“Ten projects totalling 177,100 sqm are in the plans approved stage, with three projects totalling around 37,600 sqm in the plans submitted stage. The majority (80.5%) of these projects have not been pre-committed,” the report said.

Here’s more from JLL:

Occupier demand in the Perth market decreased over Q4 2024, with approximately 45,900 sqm of gross take-up recorded across ten major occupier moves (≥3,000 sqm). Quarterly tenant activity was also below the two-year quarterly average of 54,900 sqm.

Industrial and logistics gross take-up totalled around 295,400 sqm over the past 12 months, significantly above the 10-year average of 190,100 sqm. Demand was led by the transport, postal & warehousing (33.4%), manufacturing (14.8%) and retail trade (13.0%) sectors.

Rents and yields are unchanged

Average prime existing net rents were stable across all precincts over Q4 2024. On an annual basis, rental growth was strongest in the North and South precincts at 5.6%, followed by 3.6% in the East precinct.

Prime midpoint yields across all precincts were stable at 6.50% over the quarter. On an annual basis, yields have softened 25 bps across all three precincts.

Outlook: Low pre-commitment rates in the Perth supply pipeline

Despite still-elevated construction costs, high labour costs and low project feasibility, speculative supply remains prominent in the Perth market. Speculative supply will be further supported by strong occupier demand expected over the short term.

Robust occupier demand and supply scarcity in the Perth market is forecast to accelerate rental growth over the short to medium term.