Robust leasing volumes continue

• Gross take-up increased by 4.9% over the quarter to 318,900 sqm, 29.8% above the 10-year quarterly average. Leasing of existing space, including recent speculative completions, accounted for 83.5% of the area leased.
• The largest deal recorded in the quarter was logistics group EWE’s lease of 36,200 sqm in Pemulwuy (Outer Central West). This was followed by Jennmar’s pre-lease of 31,058 sqm at Charter Hall’s Smeaton Grange redevelopment (Outer South West).

Supply delivery slows

• Sydney recorded 150,200 sqm of industrial completions in Q3 2025, a 48.0% decrease q-o-q. A further 166,700 sqm is anticipated to complete by the end of 2025, bringing annual completions to 649,200 sqm, a 40.1% decrease y-o-y.
• Supply delivery is expected to rebound in 2026, with 750,100 sqm under construction anticipated for completion the following year. Under-construction stock is 61.3% pre-committed.

Investment activity accelerates

• Rents were largely stable. Where rental growth was recorded, it was driven by the delivery of new, higher quality stock to older precincts. The average midpoint incentive increased 62.5 bps to 19.2%, the highest level since JLL began tracking incentives in Q1 2010.
• Strong investment activity levels supported further yield tightening. The average prime midpoint yield tightened by 12 bps over the quarter to 5.31%.

Outlook: Vacancy stabilising but supply uptick expected in 2026

• Slowing supply completions and robust leasing volumes are expected to stabilise vacancy over the remainder of 2025. However, speculative supply deliveries could put upward pressure on vacancy and constrain rental growth over 2026.
• We expect investment activity to remain elevated in Sydney’s industrial market, supporting continued yield compression. Short-WALE assets with strong rental reversion prospects are driving upper-end yield tightening.