INDUSTRIAL WILL BE THE STANDOUT ASSET CLASS
It ’ s no myth that industrial has been the most active asset class around the country . While industrial is the largest commercial asset class there is , it ’ s no surprise that it has accounted for more sales transactions than any other property type . However , the great range of industrial property has also seen it the most affordable for first time commercial investors who have grown their activity in 2021 . Over the past two years there has been a remarkable increase in new business starts borne from COVID-19 . As these mature , the need for accommodation has also grown interest for the owner-occupier segment . In the sub $ 50 million market , the Australian market recorded $ 16.23 billion in industrial transactions in 2021 , up 123.73 per cent on 2020 results . With an average sale price of $ 1.83 million , there ’ s no surprise that both seasoned and new investors together with owner-occupiers have jumped into the industrial market to diversify their portfolio during this time of low interest rates .
However it ’ s not just the small end of the market showing encouraging signs , further emphasising the strength of the industrial market has been a number of larger portfolio sales , which have transacted across listed funds and offshore groups . These deals of over $ 1 billion are supported by yields of sub 4.5 per cent highlight the long term commitment to this asset class . Our need for warehousing , logistics , distribution and storage has been heightened during COVID-19 , with online retailing rapidly growing and these trends are not expected to dissipate . Indeed , the trends will further advance as automation and technology move industrial assets into premium , high-value investment assets .
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