CQ industrial property market on rise amid new project boom
THE RIPPLE effect of multiple infrastructure projects in the Central Queensland region are being felt in the district’s industrial property market, with experts officially upgrading the sector to the ‘start of recovery’ phase in Rockhampton and Gladstone.
Rockhampton and Gladstone’s industrial real estate sectors were one of six across the country to take the positive turn according to Herron Todd White’s Month in Review report for August.
Other regions also on the upward swing are Cairns, Adelaide, Horsham and Mildura.
HTW experts attributed Rockhampton and Gladstone’s results to significant infrastructure spending in the regions – which is set to continue over the next five years.
“As a consequence, we expect employment growth and that will have a positive impact on the industrial property sector in Rockhampton,” HTW analysts said.
“Coal prices showed some stability at profitable levels from 2016 to late 2019 and this helped support industrial activity, however coal prices have declined and have shown greater instability over recent months.
“The rate of growth in industrial markets in Rockhampton is now more likely to be dependent on the timing of infrastructure projects coming to fruition.”
HTW analysts said industrial rental rates in Rockhampton and Gladstone had remained relatively stable.
“There have been no notable increases, however there appears to be a steady uptake of some vacant industrial properties,” they said.
“We anticipate that as demand increases and supply reduces, we may start to see some growth in the rental market.”
Real Commercial data shows an industrial warehouse at 9 Waurn Street, Kawana has recently been leased along with sheds at 11 and 13 of 10 Dooley Street, Park Avenue.
The site at 399 Yaamba Road was leased in late July as well as 306 Alexandra Street, Kawana.
Investor activity was also a key talking point in the industrial scenes of both cities.
“Investors are active in all Central Queensland markets and will usually consider investment
opportunities across a number of asset classes including industrial property however will place most emphasis on WALE and tenant strength,” HTW said.
“Yields for these properties have generally been achievable in the 7 per cent to 10 per cent range for local tenanted property, which is an attractive option in comparison to our more southern metro markets, driving interest from non-local buyers.
“Yields can be somewhat lower for property with national tenants.”