An uptick in quarterly gross take-up over Q4 2024

• Occupier demand continued to increase in the quarter, with gross take-up totalling approximately 51,600 sqm. This figure is above the average quarterly gross take-up of around 38,700 sqm recorded over the last 10 years.
• Seven large occupier moves (>3,000 sqm) were recorded over Q4 2024, with the largest move being a 22,000 sqm pre-lease deal for Auswide Transport Solutions at 10-18 Mirage Road, Direk, in the Outer North precinct.

Supply delivered to market is stable quarter-on-quarter

• There was approximately 23,700 sqm of new supply added to Adelaide total stock in Q4 2024. Currently, there are 12 major developments under construction totalling 157,500 sqm, with the latest project expected to deliver in Q4 2025. The pre-commitment rate for these projects is 76.1%.
• There are seven projects with plans approved in the future supply pipeline, totalling 114,118 sqm. Additionally, there are two projects with plans submitted, totalling 34,000 sqm.

Continued strong rental growth in Adelaide

• Average prime net face rents increased across half of the precincts in Q4 2024, excluding the Inner West/East, North East and Outer North precincts. The rise in asking rents is a result of the continuing trend with occupier demand outpacing supply.
• Average land values increased marginally in Q4 2024 as supply for development sites remain limited in the market. On an annual basis, average land values for 2,000 sqm lots increased between 14.3% and 40.0%.

Outlook: Supply shortage is expected to accelerate rental growth in the near term

• Occupier demand is anticipated to improve as the broader economic environment stabilises. Speculative supply from developers is likely to remain low as construction material and labour costs remain elevated.
• Rental growth is expected to accelerate over the short term due to low supply, coupled with a major infrastructure project which has displaced many businesses. The yield softening cycle is forecast to conclude by the end of 2025, reaching a midpoint yield of 6.25%.