Rising demand for cold storage facilities.

Chill Factor

The foundational shift created by e-commerce growth has fuelled the broader demand for industrial real estate, but investor appetite for niche sectors, such as cold storage warehousing is also growing.

These facilities are critical for preserving the quality of perishable goods, from fresh produce to temperature-sensitive pharmaceuticals.

Globally, inadequate refrigeration leads to the loss of around 12–13% of all food produced each year, costing an estimated USD 1 trillion annually, according to the United Nations.

Robust cold storage infrastructure not only reduces waste but also supports international trade, stabilises supply chains, and helps manage market volatility.

In a world of rising regulatory standards for food and pharmaceutical safety, the strategic value of cold storage has never been greater.

The coolest sector in industrial

Once the domain of owner occupiers, the cold storage sector is now firmly on the radar of institutional investors, REITs, and private equity. The momentum was on full display in July 2024, when Lineage Logistics completed a USD 4.44 billion initial public offering, the largest global stock market debut of the year. Nearly 57 million shares were sold at USD 78 each, near the top of the range, propelling Lineage’s market capitalisation to USD 18.7 billion and signalling strong investor confidence in the sector’s long-term growth trajectory.

This series of Cold Storage articles takes a deeper look at the forces shaping investment decisions in cold storage, from demand drivers and accessibility to trade routes, to building height trends, vacancy rates, and recent investment performance.

To bring sharper locational insight, Savills has partnered with location intelligence specialist SA1 Property. Leveraging their SA1 Industrial platform, we analyse key East Coast markets to identify the geographic patterns, clusters, and accessibility factors underpinning the sector’s growth.

Up Next: The Cold Achiever & The Heat Behind the Freeze

Australia’s cold storage market is heating up - but how does our capacity compare to the rest of the world? In The Cold Achiever, we reveal the per capita gap and the scale of opportunity for investors looking to capitalise on this growing sector.

Australia’s capacity shortfall is clear - but what’s driving the demand? Then, in The Heat Behind the Freeze, we unpack the demographic, economic, and trade forces powering long-term growth in cold storage.

Image Source Hale Capital Partners, 347 Lytton Road, Morningside, Queensland

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The postings by any individual on any blog do not necessarily represent the position of Savills, its strategies or opinions.