The new Financial Year has seen industrial real estate emerge as arguably the best performing commercial property asset class. Western Australia’s successful response to the Covid-19 outbreak has seen the State recover faster than expected from the lockdown period with a number of both leasing and sale transactions taking place across the premier industrial precincts of Welshpool, Kewdale and Canning Vale.
Letting up periods have decreased, as have incentives offered to tenants as a result of increased competition for quality industrial assets. Modern, well maintained workshops and warehouses continue to perform strongly from a leasing perspective. Likewise, the low interest rates and shortage of quality stock has seen a number of modern factory units sold in the past six months with multiple offers being presented.
The recovery of the trucking and transport sector has seen a strong demand emerge for buildings between 1000 sqm and 2500 `qm with good hardstand space, particularly in the Welshpool and Kewdale areas. As expected, a number of business have relocated back to Welshpool and Kewdale over the past 12 months from industrial areas further north and south. This reaffirms the expectation that Welshpool and Kewdale are still considered to be the premier Industrial suburbs which will perform strongly as Perth recovers from the recent downturn.
The close proximity to major arterial road networks including Tonkin Highway and Roe Highway means many owner occupiers and tenants see the location as a preferred position for their businesses. As both leasing and sales transactions continue to gain pace due to the low interest rates and buoyed confidence, MLV expect supply levels to reduce and expect to see recovery in both land values and rental rates over the next 12-24 months.
MLV will continue to work with our clients to ensure their assets are best placed to take advantage of this momentum-gaining industrial market.
If you would like to discuss any of the above, please don't hesitate to contact MLV Sales & Leasing agent Rory Feely on 0450 520 227.