Investor Presentaiton
Australia Industrial Market Outlook
While the supply for 2023F is forecasted to be at a record high of approx. 3.1 million sqm, the overwhelming demand for
logistics space is expected to continue to outstrip the supply capacity
1
The Australian economy is expected to moderate with GDP growth
forecasted to ease from 3.7% to 1.25% in FY2023 and FY2024(1).
Australian Industrial & Logistics Supply (sqm)
4,000,000
3,000,000
2
Higher interest rates coupled with higher inflation and tighter monetary
policy settings are expected to dampen the growth in Australian
economy.
2,000,000
1,000,000
3
0
THE
2013 2014 2015 2016 2017 2018 2019 2020
Source: Colliers Research
Industrial Submarket
10-Year Average
2Q2023 Secondary
Grade Market Rents
(A$sqm/p.a)
2Q2023 Prime Grade
Market Rents
(A$sqm/p.a)
204-244
4
5
The strength of the Australian industrial and logistics sector has
continued into Q2 2023 with over 930,000sqm leased, albeit the take up
in 1H2023 has fallen by approx. 37.0% comparing the same period in
2022(2). Take up is expected to continue to slow down for rest of 2023 as
consumers reign in their budget and spending on discretionary retail
items in view of recessionary fears.
2023 is a record year for development completions, totaling 3.1 million
sqm of floorspace, with approx. 690,000 sqm of space delivered
nationally (3). It is however still unlikely to be sufficient to restore
equilibrium between supply and demand in the near term as pre-
commitment-rate of the supply for the year is high in 80% range.
Rental uplift is expected to continue in 2023 in high single digit growth.
Incentives remain low up to 7.5% range.
Sydney
Melbourne
Brisbane
Adelaide
Perth
National Average
ESR-LOGOS
REIT
2021 2022 2023
FY2024E Forecasted
Rental Growth
178 - 200
5.0%
107-117
125-138
4.0%
116 133
133-157
6.0%
84-96
115-141
4.0%
95-110
110-133
6.0%
132-149
132-149
4.0% -6.0%
Notes: (1) Based on Economic Outlook by Reserve Bank of Australia dated May 2023 (2) Based on Colliers 2Q2023, Australian Industrial & Logistics Snapshot. (3) Based on CBRE Australian
Industrial and Logistics Figures 1Q23 (3) Based on Colliers 4Q2022, Australian Industrial & Logistics Snapshot.
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