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Industrial property well placed to ride out COVID-19

Industrial property is well placed to ride out the short-term uncertainty which has been caused as a result of COVID-19, according to Colliers International.

The latest Colliers radar paper ‘COVID-19 Industrial Implications’ maintains that the recent growth in demand for transport and logistics as well as the key role industrial property plays in keeping the basic day to day necessities of Australians in supply, are key factors which will see the sector through the months ahead.

“Notwithstanding the short-term impacts, fundamentals within the Australian industrial and logistics market remain favourable with several structural and cyclical changes playing into the hands of the sector,” said Malcom Tyson, Managing Director, Industrial at Colliers International.

“Bringing it back to basics, the key drivers of the industrial market in recent years have been population growth, infrastructure investment, growth in e-commerce and low cost of debt.”

“Although population growth is expected to take a hit over the short term, as net overseas migration drops significantly off the back of travel restrictions and the closure of the Australian borders to non-citizens, the outlook for the other key drivers in the current environment remains unchanged.”

Colliers' paper notes that the e-commerce sector in particular, continues to expand structurally, and the coronavirus outbreak is expected to result in a pick-up in online retail sales and subsequent demand for industrial space.

“With stores adjusting their hours and political leaders asking the public to stay home, the value of e-commerce has increased exponentially,” said Luke Crawford, Associate Director, Research at Colliers International.

“Demand for large distribution and warehouse facilities is expected to continue its strong run over the past few years, particularly for last-mile locations; food companies, logistics companies, warehousing and to some extent manufacturing have shown how important they are in times of “social distancing” and keeping the supply chain open.”

“The panic buying of consumer staples during uncertain times like these has put food manufacturers and suppliers in the position of making sure their network of distribution and warehousing facilities are adequate to handle these types of demand spikes on a regional basis.”

It is expected that some companies may need to expand their industrial footprint in metro areas to keep up with the increased demand.
 
Highlighting this was the announcement in late March that Coles will open three ‘pop-up’ distribution centres in New South Wales, Victoria and Queensland to cater towards the rapid growth in food and grocery purchases.



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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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