Occupier activity is softer in Q4 2024

• Occupier demand for industrial space has decreased in comparison to Q3 2024. A total of 77,100 sqm was leased during the quarter, below the long-term 10 year quarterly average of 151,500 sqm.
• Tenants within the retail trade industry supported quarterly demand. Bunnings pre-leased a 27,100 sqm warehouse in the Southern precinct, this marked the largest leasing transaction and only pre-lease recorded in Q4 2024.

New completions have slowed, following a period of elevated construction activity

• New completions reached 89,900 sqm in Q4 2024, which was the lowest number of new supply since Q4 2022. Pre-commitment was moderate at 43%. New completions were highest in the Southern precinct (36,200 sqm) and Trade Coast (34,300 sqm).
• Industrial supply under construction totalled 411,600 sqm with a pre-commitment rate of 28.6%. Development activity is focused in the Southern precinct, a total of 222,400 sqm is under construction and forecast to complete in 2025 and 2026.

Rent growth remains positive in all precincts

• Net face rents remained highest in the Trade Coast at AUD 197 per sqm per annum. The Trade Coast outperformed other precincts with quarterly rent growth of 3.9% and year-on-year growth of 16.2%.
• Investment volumes in Q4 2024 reached AUD 421.1 million, above the 10-year quarterly volume of AUD 257.9 million. A portfolio transaction has bolstered capital activity in the Brisbane industrial market.

Outlook: Delivery of new supply to moderate in 2024, as pre-lease activity slows

• Gross take-up and pre-leasing activity may remain subdued in the near term, as tenants are hesitant to expand, in these current economic circumstances.
• The vacancy rate could increase marginally in coming quarters, as large speculative developments are underway and forecast to complete in 2025.