E-commerce to result in record industrial leasing demand for 2021

A record year of leasing demand is expected across industrial markets in 2021, underpinned by the continued growth of e-commerce, which will bolster warehouse demand.

Colliers International’s latest Industrial Research and Forecast report found leasing demand for industrial property is expected to accelerate in 2021, as economic conditions pick up and businesses have more clarity around the impacts of COVID-19 on their operations.

“The early signs of market recovery are starting to appear – business and consumer sentiment has rebounded, the labour market looks to have stabilised and consumer consumption is improving,” said Malcom Tyson, Managing Director, Industrial at Colliers International.

“Online retail sales have grown by over 80% in the year to August 2020 which is the highest annual growth on record. This has translated into strong growth for warehouse demand as ‘pure-play’ online groups and retailers look to bolster their fulfilment capabilities.”

“Looking ahead, online retail is expected to further increase in popularity as consumers embrace online shopping platforms.” 

“We are forecasting online retail spend to total circa $58 billion by the end of 2022, which would translate into warehouse demand of around 2.7 million sqm between now and then from e-commerce alone, based on experience from the US.”

David Hall, National Director, Industrial at Colliers International said “The continued take up of e-commerce is underpinning the Australian industrial market and will continue to drive leasing demand in 2021.”

“Over 1 million sqm of space has been leased across the western Sydney industrial and logistics market in 2020 so far, and we anticipate this to increase next year.”

“Demand is expected to be led by pre-commitments as occupiers focus on improving efficiencies through automation and scale.; take-up activity in Sydney has been strongest within the Outer West submarket, buoyed by the 200,000 sqm Amazon pre-commitment within the Oakdale West Estate.”

Luke Crawford, Associate Director, Research at Colliers International said “The growth of online retail continues to support leasing demand with several significant pre-lease deals being recorded in 2020 and we expect demand from these occupiers to gather pace.”

“More broadly, occupiers are taking longer to commit to new or expansionary space as they look to better understand the longer-term economic impacts on their business.” 

“Looking ahead, activity is expected to pick-up over the next six months with a sharp increase in tenant enquires being recorded over the past month.”


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Malcom Tyson

Managing Director | Industrial

Sydney CBD

Malcom joined Colliers International in 1994 in the North Sydney office as an industrial sales and leasing agent. Colliers International is known in the market for their progressive, collaborative and innovative culture, and he was very determined to join their team. Now as a leader in the business, he facilitates that collaboration across our service lines both domestically and internationally to achieve our goals. Over his 26 years at Colliers, Malcom has developed and grown multiple teams; his current role is Managing Director of Industrial where he heads up the largest and most specialised industrial division in Australia.

In 2005, Malcom joined the ANZ Executive where the leadership group has steered Colliers International to reach incredible growth and further developed our brand and client offering. Malcom became the NSW State Chief Executive in 2006, and leads the 730+ staff in the NSW team across six offices and dozens of on-site management teams. Our NSW business is the Centre of Excellence for the broader Australia and New Zealand teams, and our team leads the business in innovation and best practice.

Malcom's speciality is the sales and leasing of institutional-grade industrial property, and he works to provide his clients with insights into the future of industrial property and where they can reap the most value. Having sold over $6bn+ of property over my career,  Malcom gets a great deal of satisfaction being a trusted advisor and expert for his clients.

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David Hall

National Director

Sydney West

David is a National Director – Industrial at Colliers International and also holds the role of Director in Charge for the Sydney West Industrial department. Based in Parramatta, David's team of thirteen agents is one of the largest and highest performing teams in Australia.

Since joining Colliers' in 2016, David’s specialisation is within the key Western Sydney markets, with a heavy focus on large transactions of land, development projects as well as large leasing appointments and corporate mandates.

With an enterprising attitude, David brings a wealth of experience and creative thinking to some of the more challenging industrial property solutions, accelerating the success of his clients.

 

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Luke Crawford

Associate Director

Sydney CBD

Luke has eight years’ experience in property research and real estate advisory, providing strategic advice and research to private, government and listed groups. Luke’s current focus at Colliers International is industrial research nationally, where he provides high quality research and advice on the trends impacting the sector to both internal business lines and clients.

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.

Luke’s areas of expertise include property research, demographic assessments, highest and best use analysis and supply and demand assessments across a broad range of property sectors including industrial, office, residential, student accommodation and retirement and aged care.

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