Quarterly occupier demand maintains upward momentum

• Occupier demand in the Perth market rebounded over Q3 2024, with 100,300 sqm of gross take-up recorded across 11 major occupier moves (≥3,000 sqm). Quarterly tenant activity was significantly above the ten-year quarterly average of 51,200 sqm.
• Gross take-up totalled 305,900 sqm over the past 12 months, significantly above the 10-year average of 190,900 sqm. Demand over the same period was led by the Transport, Postal & Warehousing (20.3%), Manufacturing (15.2%) and Construction (10.6%) sectors.

Confirmed supply pipeline remains elevated

• Five major developments (≥3,000 sqm) completed in Q3 2024, totalling 43,600 sqm. In addition, ten projects totalling 111,400 sqm are under construction, with expected completion by end-2027.
• Seven projects totalling 86,400 sqm are in the plans approved stage, with three projects totalling 21,100 sqm in the plans submitted stage. The majority (65.0%) of these projects are uncommitted.

Rental growth recorded across all industrial precincts

• Average prime existing net rents increased across all precincts over Q3 2024, increasing 3.6% in the East precinct, and 3.8% in the North and South precincts respectively. On an annual basis, rental growth was strongest in the South precinct at 5.6%.
• Prime midpoint yields across all precincts softened 25 basis points (bps) over the quarter. On an annual basis, yields recorded a softening of 50 bps across all three precincts.

Outlook: Rental growth expected to accelerate

• Uncommitted supply is still prominent in the Perth market despite still-elevated construction costs, higher labour costs and low project feasibilities. This is further supported by strong occupier demand expected over the short term.
• Rental growth is expected to accelerate over the medium term, driven by strong on-going occupier demand and supply scarcity in the Perth industrial and logistics market.