Brisbane Commercial & Industrial Property Market Review - March 2024
“...higher levels of new space are expected to come online over the next two years, with elevated speculative developments and low vacancy rates driving a 50% increase in new supply completed in 2023 compared to the previous year.”
In the Brisbane industrial real estate sector, the last quarter of 2023 saw a decrease in occupier take-up due to limited property availability.
Pre-lease transactions accounted for a significant portion of leasing activity, driven by ongoing speculative development in Brisbane. Throughout 2023, total gross take-up exceeded the 10-year average, with the Outer South Brisbane area experiencing the highest concentration of leased space. However, forecasts suggest a slight decline in take-up for 2024 as occupiers reassess expansion plans amidst softer consumer sentiment and an extremely low vacancy rate in Brisbane. The transport, postal, and warehousing sector dominated leasing transactions. Demand for space mainly came from occupiers within these sectors, as well as the retail trade and manufacturing industries, driven by the expanding e-commerce sector.
On the supply side, higher levels of new space are expected to come online over the next two years, with elevated speculative developments and low vacancy rates driving a 50% increase in new supply completed in 2023 compared to the previous year. However, developers are demanding significantly higher rents to ensure project feasibility, potentially impacting the amount of new space being built.
Investment transaction volumes remained limited in the last quarter of 2023, with uncertainties surrounding interest rates and economic outlooks contributing to market hesitancy.
Kyryl Koltsov, FAL Property Group