Australia’s industrial property boom may have finally reached its peak, according to leading real estate agency Savills Australia’s recently released ‘Spotlight Industrial Shed Briefing – July 2024’ report.
The report revealed that industrial vacancy rates are climbing on the East Coast – reaching 3.4% in July – while rental growth slows to a standstill across most core markets.
But according to Savills, investment activity remains robust with total investment volumes exceeding $3 billion in Q2. While reflecting a modest increase of 8% from Q1, it’s a whopping 168% greater than its lowest quarter last year – and driven partially by Barings and REST Super’s recent $780 million acquisition from Goodman Group.
While this points to investors’ continued appetite for industrial, Savills says we may be closer to the cyclical bottom than previously thought.
The Shed Briefing has also revealed leasing activity is at pre-pandemic levels – with 767,875 square metres of industrial space leased in Q2. This reflects a 20% increase from last quarter.