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Australian industrial investors and occupiers remain positive

The Australian industrial logistics market remains a key focus for investors, with the outlook for the sector remaining relatively positive, according to the Colliers International Industrial Investment Survey. 

Colliers’ survey results found that 89% of Australian industrial investors favoured the logistics sector over other commercial sectors, with 43% of investors intending to acquire their next industrial asset within the next six months.

The Industrial Investment survey also found that just 15% intend to divest their assets over the same period, highlighting that the mismatch between supply and demand will remain.

“Despite recent market uncertainty, 89% of investors surveyed expect the market to stabilise in around 12 months,” said Malcom Tyson, Managing Director, Industrial at Colliers International.

“In the interim, just over half of investors (54%) believe capital values will fall by up to 10%, with 64% are expecting cap rates to soften by up to 50 basis points.”
“Sydney and Melbourne remain the focus cities for investors with almost 60% of investors saying they are very likely/likely to invest in these capital cities within the next 12 months.”

The survey found that almost 78% of investors see tenant solvency and the re-pricing of assets as the biggest challenge facing investors amid the current health crisis.
The positive sentiment was also echoed by industrial occupiers; Colliers International found that 21% of occupiers surveyed reported minimal impact on their business as a result of COVID-19, with nearly three quarters already having a risk management plan in place. 

“Occupiers remain optimistic about current trading conditions with 53% expecting their volume of business to be better off or the same as it is now over the next three months,” said Luke Crawford, Associate Director, Research at Colliers International.

“Similarly, 75% expect their workforce to remain the same or grow over the next 24 months. To achieve efficiencies and better respond to the impacts of COVID-19 on their business, 85% of occupiers have reviewed their supply chain network, while 30% plan to relocate to a bigger warehouse over the next year.”

The survey found that the biggest impact of COVID-19 on industrial occupiers has stemmed from revenue loss, increased cost of doing business and idle capacity which collectively impacted 55% of businesses. 

Read the results of Colliers' Industrial Investor Survey here.

Read the results of Colliers' Industrial Occupier Survey here.

 

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Malcom Tyson

Chief Executive Officer | Australia

Corporate Executive

Sydney CBD

Malcom is the Chief Executive Officer for Colliers in Australia, delivering on our business plan and driving our enterprising culture. Our company is underpinned by a clear set of values, designed to maximise the potential of property to accelerate the success of our clients and our people.  

Over his 27-year career with Colliers, Malcom has had the opportunity to build and grow a number of successful teams. Prior to his current role, he led the NSW business along with the national Industrial business for 15 years. In 2005, Malcom joined the National Executive where the leadership group has steered our business to achieve incredible growth and reinforced our market-leading culture. Our business stability and continuity continue to attract market leaders, empowering them to think and act differently to drive exceptional results.  

Colliers has an enterprising culture which underpins our strategy for success. The business has won multiple accolades as a Best Employer and best in class in many service arenas. We appreciate the loyalty of our people and our clients and we thrive on collaborating to create enterprising solutions that exceed expectations. 

Within Australia, Malcom has had the benefit of working with a highly regarded leadership team, including John Marasco and Simon Hunt, who are focussed on maximising the potential of property for our clients, through delivering enterprising solutions as we work through the market conditions of 2021. By keeping aligned to our values of being enterprising to exceed expectations and collaborating to drive exceptional results, Colliers are well positioned in 2021 to maximise the potential of property and to be a part of leading our industry into the future, not only in Australia but right across the Asia Pacific region. 

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Luke Crawford

Director

Research

Sydney CBD

Luke has 10 years’ experience in property research and real estate advisory, providing strategic advice and research to private, government and listed groups. Luke currently heads up the national industrial and logistics research function at Colliers, where he provides high quality research on the trends impacting the sector to both internal business lines and clients.

Luke has provided tailored and strategic industrial and logistics research to groups including Charter Hall, Mapletree, ESR, Ascendas, Centennial and ARA.

Prior to joining Colliers International, Luke has held roles within the Real Estate Advisory Services (REAS) division at KPMG and the Research and Consultancy team at Knight Frank.

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