In quarter 2, 2017 the Mid West industrial market had approximately 138,000 sqm of built space available for lease plus circa 67,000 sqm of space with leases expiring within the next 12 months. This industrial market contained over 3 million sqm of warehouse accommodation (buildings over 5,000 sqm) so this reflected a then vacancy rate of 4.6%.
Today the Mid West offers 13 buildings for lease (> 5000 sqm) with approximately 130,000 sqm of built space reflecting a vacancy rate of 4.3% (> 5,000 sqm). Taking into account looming lease expiries, there is potential for a further 104,000 sqm approximately, over 9 buildings that may come on line over the next 12 months.
Only one building greater than 5,000 sqm has sold within the last two quarters – a 12,973 sqm building at a rate of $1,911psm.
Over my 17 years in industrial real estate, this reflects the most tightly held market place I have seen, with the lowest vacancy rates for both sales and leasing opportunities.
So what does 2018 bring for the Mid West?
The enquiry level is still high and confidence within the market is strong with infrastructure spending by the government at an all time high. I believe the industrial markets still have room to grow in both rental and capital values into 2018.
If you like to have a discussion regarding the industrial market please contact me directly on 0406 535 569.
Author: Paul Mileto
Paul is an executive based in our Silverwater office.