Owner-occupants continue to drive competition as sale rates remain robust across southwest Sydney. Competition for quality industrial assets remains strong as owner-occupiers continue the trend of paying record prices for warehouses to secure their position for future business'' says David Ferreri Director of Coutts Wetherill Park.

David Ferreri has recently sold Four Free Standing Industrial assets with Three of those selling to owner occupiers; each campaign generated substantial enquiry with a number of parties vying for each asset.

According to Coutts Director, David Ferreri “Earlier in Q3 we auctioned a 858sqm warehouse in Wetherill Park on 1,786m2 of land that attracted over 10 bidding parties at the auction. The warehouse and small office sold for $4.9M equating to $5,710.00Pm2. “Rents on industrial property continue to increase off the back of a lack of stock across the southwest Sydney markets.

We're continuing to see strong appetite to secure quality assets particularly in the freestanding sector Says David Ferreri. Just recently, we concluded a lease transaction for a 1,000m2 warehouse located in Wetherill Park over the asking price at a rate of $200Pm2 +Outgoings + GST. “e-commerce tenants, particularly, have been aggressively seeking storage space with online retail spending a key theme being discussed amongst prospective tenants.

“We’ve also observed growth in rents across new build industrial properties as developers seek higher pre-lease rents to account for higher land values and increased construction costs. “Despite the headwinds presented by macro factors and negative press, the local market is showing itself to be very resilient. There is a lot of momentum in the market at the moment, and we expect this will continue into the new year” said Mr Ferreri.

“The local property investment sector is tipped to continue to rise in 2023, with one of the most powerful drivers being a clearer outlook on interest rates and the anticipated trailing off of further increases, says David Ferreri.

“Some investors may continue to wait out the impact of higher interest rates, however low leverage investors would tend to look through short term volatility to the longer term stability and robustness of commercial property as an investment class.

In addition, we are beginning to see more properties coming to the market for sale, which in turn may offset the imbalance between supply and demand and create a more stable market and window of opportunity for the investor. However, we would need to see rents increase further to re-balance the risk/return paradigm.

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