Outlook good for industrial property

The Queensland economy has been slow to recover from all its natural disasters. But its industrial property sector has been quick out of the blocks.

The boom in Queensland gas now has Brisbane with the lowest vacancy rate for industrial property.

Next comes Melbourne — with Sydney well back in third place, according to a recent survey by Knight Frank.

And increasing demand will put further upwards pressure on rentals, thereby encouraging more developers into the market.

While the Brisbane market is gas-driven, Melbourne (which is Australia's largest industrial market) enjoys a much wider tenant profile.

As such, its increase in speculative A-grade buildings has been readily absorbed over the past 12 months.

Sydney, however, his languished somewhat — with a cautious market showing an even split in the take-up, between A- and B-grade facilities.

Bottom Line: Industrial property is poised for some good rental and capital growth over the next few years, as yields start to firm.

Chris Lang is an advisor to commercial property investors and gives keynote speeches and regular seminars on the best way to invest in commercial property. He maintains a blog, his-best.biz, which he updates regularly about the best way to get the most out of your commercial property investment.