Sydney Commercial & Industrial Property Market Review - March 2024
“The central west and mid west markets of Sydney are particularly busy with demand buoyant and seemingly eager to conclude lease transactions. In line with demand returning, so have stock levels.”
A new year and the market certainly feels different. Demand across a lot of western Sydney has returned, after slowing toward the end of 2023.
The central west and mid west markets of Sydney are particularly busy with demand buoyant and seemingly eager to conclude lease transactions. In line with demand returning, so have stock levels. In all areas of western Sydney, we are seeing higher stock levels than we had become accustomed to, particularly in the 2,000 to 10,000sqm size range. South Sydney remains much the same as it was in Q4 ’23, with demand being pensive and stock remaining at a steady supply, with new, multi level industrial opportunities in Alexandria being completed.
Quality property for sale remains in tight supply, with demand from purchasers still outstripping supply, maintaining pressure on pricing, despite being at the top of the interest rate cycle. With the likelihood the interest rate and inflationary cycle may be transitioning, we expect demand to be maintained as purchasing power and business confidence returns to the market.
There remains significant reversionary rental to wash through the market as existing leases with market reviews falling in 2024 & beyond impact passing rents. Outgoings are also adding pressure to tenants on net leases, with insurance and land tax making themselves felt.
Matthew Herrett, Link Property Services