Buyers continue to actively seek out industrial assets in the current environment given the high occupancy and strong gains in rental growth over the past couple of years . Owner occupiers also are active in this segment of the market - small businesses looking to shelter from the uncertainties in accommodation costs , purchasing via their SMSF keeping activity levels up despite the growing interest rate environment . Industrial continues to be the most active asset class to invest in , it has represented approximately 44 per cent of the total turnover for the last three years and remains the number one choice for buyers at this smaller price point . Office and retail historically have been attractive investments , smaller strata office suites or retail space , and freehold strip retail dominating this price range . With changing retail conditions and working from home hampering the broader office market , activity has softened a little for these assets with many buyers more selective and the reduced urgency in the marketplace pressuring price .
The sectors of the market which have grown over the last few years and continue to be in demand are various alternative assets , these are income generating investments with long , quality leases in place often referred to as “ set and forget ”. Service station activity has been overtaken by the demand for childcare and medical facilities while fast food also remains an investor favourite . The hotel and tourism sector has also had a busy few years , while there are limited opportunities in this price point ; regional motels and pubs have seen an uptick in activity , and similarly , caravan park properties .
One of the major changes we ’ ve seen in results this quarter compared to the same period in 2022 and 2021 is the reduction in activity in regional markets . The rush to purchase over the last few years saw many buyers move up the risk curve to secure an asset as competition grew , often looking not just interstate but to regional markets where affordability was greater . This trend has declined with those buyers in the market at the moment being more thoughtful and selective with their investment purchase which is likely a trend to remain for the medium term .
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