Colliers latest White Paper “Investing in the West” delves into the strategic opportunities amid growth of the Western Sydney Region across various asset classes. The Industrial & Logistics sector is experiencing these opportunities, as a result of structural shifts that continue to drive performance. 

As Industrial & Logistics rents start to moderate after two years of aggressive growth, there remains little doubt that investment returns will continue to surpass those witnessed historically. This is particularly true for one of the nation’s highest performing markets, Western Sydney.

Colliers Managing Director, Industrial & Logistics, Gavin Bishop said: “As the demand for industrial space outstrips available supply, with 46% of the 2024 supply already spoken for, investment interest is set to soar in Western Sydney, one of the country’s most robust markets.” 

Supply will fail to meet demand, with 2.5-3 million square metres of active tenant demand currently recorded across East Coast submarkets. Appetite for Western Sydney’s limited industrial land ensures values for this market currently average $1,500 per square metre, compared to $800 for Melbourne and $600 for Brisbane.

“Considering the remarkable 39.4% growth in Prime industrial rentals in Western Sydney during 2023, a significant deviation from the long-term average of 4.9% per annum, landholders engaging in speculative development strategies are driving a notable increase in development activities across the region.” mentions, Jock Tyson Senior Executive, Industrial & Logistics. 

Western Sydney Prime industrial rents now average $245 per square metre net face. Deals in excess of $280 per square metre net face were even recorded last year.

With constricted supply of both industrial land and developed assets, and economic stabilisation on the horizon, momentum for investment activity is set to escalate this year.

“Forward-thinking investors would be wise to capitalise on counter-cyclical opportunities before facing increased competition, driven by stabilising interest rates and ongoing constraints in industrial asset supply” said Matthew Flynn, Director, Industrial & Logistics. 

For further insights regarding development and investment across Western Sydney, within Industrial & Logistics or other services click here to view Colliers latest white paper: https://www.colliers.com.au/en-au/news/investing-in-the-west
 

More from Colliers Industrial & Logistics team:

Named number 1 in Australia for Industrial Sales – Colliers

Expanding Horizons: Colliers I&L Team’s Response to the Thriving Western Sydney Market – Colliers

Data Centre Expertise and Insights – Colliers