Quarterly occupier demand on an upward trend

• Occupier demand in the Perth market continued to increase over Q2 2024, with 80,169 sqm of gross take-up recorded across 13 major occupier moves (≥3,000 sqm). Activity recorded in the quarter was above the two-year quarterly average of 53,693 sqm.
• Perth recorded 292,912 sqm of gross take-up over the past 12 months, significantly above the 10-year average of 189,121 sqm. Demand was led by the Transport, Postal & Warehousing (27.7%), Manufacturing (14.0%) and Construction (10.2%) sectors.

Under-construction supply pipeline increases

• Five major developments (≥3,000 sqm) reached completion in Q2 2024, totalling 64,850 sqm. There are 14 projects totalling 131,271 sqm currently under construction, expected to be completed by mid-2025.
• There are currently seven projects in the plans-approved stage, totalling 82,236 sqm and two projects in the plans-submitted stage, totalling 16,790 sqm. A significant proportion (82.0%) of these projects are speculative developments.

Marginal rental growth across most industrial precincts

• Average prime existing net rents were unchanged in the East precinct over Q2 2024 but increased 1.6% and 1.7% in the North and South precincts respectively. On an annual basis, rents were unchanged across all precincts.
• Prime midpoint yields across all precincts were stable in the quarter, following stability observed in the cost of debt environment. However, on an annual basis, yields recorded a softening of 50 basis points across all three precincts.

Outlook: Rental growth expected to remain positive

• Occupier demand is expected to be strong over the short term, and despite still-elevated construction material and labour costs, speculative supply is still prominent in the Perth market.
• Rental growth is expected to remain positive over the short to medium term, driven by strong ongoing occupier demand and scarcity in supply in the Perth industrial market.