Perth industrial sales hits seven-year high: Savills

Perth industrial sales hits seven-year high: Savills
Jacob RobinsonDecember 7, 2020

Industrial sales across Perth reached a seven year high last year, buoyed mostly by strong interest from private investors. 

More than $800 million worth of assets changed hands from 203 properties in the 12 months to December - up on last year's $783 million and well ahead of the five year average of $620 million. 

The results were released in the Savills Key Australian Industrial Transactions Insight report which showed that only Perth and Sydney achieved a spike in transactional activity last year. 

Private investors were again the dominant buying force in Perth, accounting for 34% of the purchases. 

Based on Savills estimates, prime industrial yields as at 31 December ranged from 7.75% and 9% in the north and between 8% and 9.25% in the south. 

"The average yield for investment properties in the north in the quarter to December was 8.38%, a 25 basis point firming over the year. 

Prime industrial capital values were between $1,000 to $1,548 per square for buildings in the north, and between $811 to $1,375 per square for properties in the south. 

The report also shone a light on the shortage of larger sized industrial lots, especially in the core industrial precinct. 

"Some relief may come from larger scale developments in the areas such as Perth Airport and Jandakot Airport, and in less central locations such as Hazelmere, Forrestfield to the east and Neerabup to the north", it said. 

It expects leasing and sales enquiries to remain strong, especially for prime quality properties with warehouses, excess lay down areas and/or gantry cranes installed. 

Bullsbrook was beginning to emerge as a future industrial hotspot, it pointed out, particularly for large transportation firms. 

Savills said if the RBA were successful in stimulating growth in the non-resources side of the economy then "the industrial markets nationally should be the beneficiaries of stronger tenant demand."

"Signs of this were seen in the last six months of 2013 and Savills Research expects this trend to strengthen in 2014." 

Editor's Picks