Research and Forecast Report. Accelerating success. INDUSTRIAL. Second Half 2018

Transcription

1 Research and Forecast Report Accelerating success. INDUSTRIAL Second Half 2018

2 EXPERTS IN PROPERTY DATA & INSIGHTS Colliers Edge harnesses the on the ground knowledge and latest transactional insights from the country s leading industrial operatives team. For market leading insights into Australian industrial market, contact us today. DEEPER INSIGHTS Largest data set on market today LIMITLESS SUPPORT Analyst not operators FAIRER PRICING Tailored to your needs Want better insights, faster? Talk to a Colliers Edge expert today Anneke Thompson National Director Research anneke.thompson@colliers.com colliers.com.au/colliersedge Accelerating success.

3 CONTENTS Domestic snapshot 4 Global snapshot 5 National overview 6 Sydney 8 Melbourne 12 Brisbane 16 Adelaide 20 Perth 22 Newcastle 25 New Zealand 27 Our experience Industrial 30 Industrial Research & Forecast Report Second Half

4 DOMESTIC SNAPSHOT *H figures as at Q BRISBANE NET FACE RENT YIELD CAPITAL VALUE INCENTIVE LEVEL $/m² H $ % $1, % $/m² H $ % $1, % % Change 1.9% -25.0bps 6.6% 0.0bps SYDNEY NET FACE RENT YIELD CAPITAL VALUE INCENTIVE LEVEL $/m² H $ % $2, % $/m² H $ % $2, % % Change 2.5% -47.0bps 11.1% bps MELBOURNE ADELAIDE NET FACE RENT YIELD CAPITAL VALUE INCENTIVE LEVEL $/m² H $ % $1, % $/m² H $ % $1, % % Change -0.6% -19.0bps 3.1% 0.0bps PERTH NET FACE RENT YIELD To Note: All figures represent average prime grade assets. CAPITAL VALUE INCENTIVE LEVEL $/m² H $ % $1, % $/m² H $ % $1, % % Change 1.2% -21.0bps 5.5% bps Average Land Value Ranges NET FACE RENT YIELD CAPITAL VALUE INCENTIVE LEVEL $/m² H $ % $1, % $/m² H $ % $1, % % Change -3.8% 33.0bps -8.3% 500.0bps ADELAIDE PERTH BRISBANE MELBOURNE AVERAGE = $249 AVERAGE = $373 AVERAGE = $259 AVERAGE* = $259 Total Export and Import Activity by State ($ Millions) SYDNEY AVERAGE = $1,018 96, , % VIC 20,393 20, % SA Year to Jul-17 Year to Jul-18 Growth 150, , % NSW 108, , % QLD 159, , % WA Share of Industrial Space Supply Pipeline 2018 to % QLD $100 $300 $500 $700 $900 $1,100 $1,300 $1,500 Source: Colliers Edge Note: *This figure for Melbourne excludes the City Fringe 4% WA 4% SA 21% VIC 1% NT Source: Cordell Connect/Colliers International 49% NSW 4

5 GLOBAL SNAPSHOT *All figures in AUD; as at Q ASIA EUROPE CAPITAL VALUE RENT CAPITAL VALUE RENT YIELD YIELD Hong Kong $9,651 $ % $5,547 $ % London $6,098 $ % Singapore Munich $3,788 $ % Beijing $2,664 $ % 4.7% Shanghai $1,812 $ % Frankfurt $2,831 $132 NORTH AMERICA RENT YIELD $3,960 $ % Los Angeles $2,215 $ % AUSTRALIA & NEW ZEALAND CAPITAL VALUE Chicago $1,469 $75 5.1% Houston $1,563 $98 6.3% Auckland Toronto $1,339 $74 5.5% Sydney Dallas $1,097 $65 5.9% Brisbane Melbourne Projected Average Annual Population Growth (2018 to 2022) 1.6% $ % $ % $1,621 $ % $1,748 $ % 1.0% 0.8% 0.6% 0.5% 0.6% 0.6% 0.7% 0.8% 0.9% 1.0% 0.4% 0.2% 0.0% 0.0% -0.2% 9.3% 9.0% A verage Annual Growth Rate (%) 1.3% 1.4% 1.2% 8.0% Exported Goods 7.0% 7.5% Imported Goods 6.0% 5.0% 4.0% 5.1% 4.9% 4.1% 4.2% 3.8% 3.0% 3.9% 3.4% 5.0% 4.3% 3.9% 3.4% 3.0% 2.8% 3.3% 3.1% 3.6% 2.6% 2.1% 2.0% Australia Canada Singapore 0.4% Hong Kong United Kingdom United States France China 0.6% Germany 0.0% Australia India Canada Singapore Hong Kong United Kingdom Source: IMF/Colliers International United States France China Japan -0.4% Japan 1.0% Germany A verage Annual Growth Rate (%) $2,491 $2, % 1.8% -0.6% YIELD Projected Average Annual Growth of Imported/ Exported Goods (2018 to 2022) 1.6% -0.4% RENT India CAPITAL VALUE Orange County Source: IMF/Colliers International Australia s Total Export and Import Activity by Value (Direction of Trade in A$ Millions, Year to Jul-18) CHINA $175,328 USA $41,572 JAPAN $71,808 INDIA $21,888 KOREA $34,733 THAILAND $20,407 MALAYSIA $18,031 SINGAPORE $17,817 GERMANY $17,411 TAIWAN $13,601 NEW ZEALAND $17,103 UK $13,582 To note: Direction of Trade Statistics presents the value of merchandise exports and imports disaggregated according to a country s primary trading partners. Imports are reports on a cost, insurance and freight basis and exports are reported on a free on board basis. Source: ABS/Colliers International Industrial Research & Forecast Report Second Half

6 NATIONAL OVERVIEW By Alex Pham Director Research Industrial property sector is the lifeblood of the economy The industrial property industry remains a critical part of the Australian economy as it provides an essential platform for the movement of goods, manufacturing and investments which are vital for economic development. The Australian economy has entered its 27 th year of growth, the longest period of uninterrupted growth in the world, on the back of a pick up in the global economy and sustainably low interest rates. GDP advanced by 3.4 per cent in the year to the end of June 2018 underpinned by rising private consumption and progression in the labour market. In fact, the economy is currently growing at a faster rate than the peak of the mining boom in September 2012 and beating market s expectations by approximately 40 basis points. Solid gains are being recorded across domestic final demand, merchandise exports, business investment and public infrastructure spending, which are the fundamental drivers of demand for industrial and logistics space. supported by increasing infrastructure investment The continued demand for industrial space is further supported by a massive investment program in infrastructure across the country. Public infrastructure spending has increased by 4.6 per cent over the year to June More importantly, investment in transportation projects has surged substantially over the past few years and expected to accelerate over the next five years with the amount of work to be done remains enormous. To top it off, the Federal government has recently announced an additional $24.5 billion funding package for transport infrastructure projects, forming part of the Government s $75 billion transport infrastructure investment over the next decade. Improvements in infrastructure are expected to have tremendous spillover benefits to the industrial property sector both directly through improved transport efficiency and productivity for industrial tenants and indirectly through elevated demand from a broader base of business services as well as valuation uplifts for industrial land surrounding the upgraded networks. Australian GDP Growth 5.0% 4.0% 3.0% 2.0% 1.0% 0.0% -1.0% Jun-08 Dec-08 Jun-09 Dec-09 Jun-10 Dec-10 Jun-11 Dec-11 Sources: ABS/Colliers International Jun-12 Dec-12 Jun-13 Dec-13 Jun-14 Dec-14 Jun-15 QoQ YoY 20Y Average Public Infrastructure Engineering Work Done $ Billions Sources: ABS/Colliers International Total Utilities Transport Australia Prime Industrial Yields 10.0% 9.0% 8.0% 7.0% 6.0% 5.0% 4.0% 3.0% 2.0% 1.0% 0.0% Mar-05 Oct-05 May-06 Dec-06 Jul-07 Source: Colliers Edge Feb-08 Sep-08 Apr-09 Nov-09 Jun-10 Jan-11 Aug-11 Mar-12 Sydney Melbourne Brisbane Perth Adelaide Oct-12 May-13 Dec-13 Jul-14 Dec-15 Feb-15 Jun-16 Sep-15 Apr-16 Dec-16 Nov-16 Jun-17 Jun-17 Dec-17 Jan-18 Jun-18 Aug-18 6

7 Technology and innovation are creating opportunities A recurring theme across the globe and in Australia recently is the speed of advancement in technology and how the 4.0 Industrial Revolution is not only shifting the paradigms in the industrial market but also creating tremendous opportunities for occupiers, owners and investors alike. For industrial users, emerging technologies in automation, robotics, autonomous vehicles, big data and artificial intelligence are helping businesses to scale up more quickly and maintain competitive advantages through more efficient distribution networks and strategic space planning, which in turn minimise labour efficiency drains and optimise productivity. Retailers and distributors can now target customers more effectively and timely with real-time shipment systems and ondemand inventory predictive technology. These new technologies are being enabled by the emergence of the next generation of technologically advanced industrial developments that incorporate innovative designs and high-tech offerings. Advances in building and construction technologies are also benefiting property owners in multiple ways. Industrial buildings can be constructed quicker and cheaper, which is offsetting against the rising land costs. Modern industrial facilities are offering substantially higher ceilings of up to 13.7 meters clear versus 9.0 metres in the past, fewer floor joints and increased load-bearing durability and density, which are required as racking capacities expand. Investment in technology by the tenant also means longer WALE and reduced vacancy risk for the landlord, as tenants often require longer term leases, often up to 10 to 15 years plus options. This is because whilst the long-term financial returns on automating processes are significant, the payback period is long, at least 7 to 10 years. In addition, the proliferation of roof top solar technology on industrial buildings is providing mutual benefits for both parties with the landlord being able to earn ancillary income from selling the energy directly to the tenants at discounted prices whilst the tenant enjoys lower energy expenses. Most importantly, industrial buildings have moved along way from the simple low-tech tilt-up panels to much sophisticated, highly efficient and flexible facilities that can adapt and adjust to a wider range of uses. Requirements are no longer confined to traditional blue-collar manufacturing industries, but have become highly diversified and include e-commerce, data centres, food and beverage retailers, dark kitchens, construction companies, furniture showrooms, health care facilities, science and technological services and hi-tech logistics and fleet management. In fact, many of the biggest occupiers of industrial space today have only been in existence after the last GFC, highlighting the extraordinary speed of disruption that is occurring and exciting times ahead for the industry. E-commerce is reaching for the Cloud The growth of E-commerce in Australia is unstoppable, with online retail sales surging by a staggering 37 per cent over the year to August 2018 to $16.4 billion according to ABS data. Despite the significant progression, Australia s online sales yet only account for about 5.0 per cent of total retail spending and lag its global counterparts. The corresponding figures in the US is 10 per cent and the UK is 12 per cent, indicating a tremendous opportunity for further growth of industrial demand from the E-commerce sector. Unsurprisingly, E-commerce retailers have been amongst of the largest takers of industrial space over the past few years, spearheaded by Amazon s entrance to the market. Anecdotal evidences globally suggest that E-commerce operators require significantly more space (approximately 3 times) than traditional warehouses due to the need to stock a greater range of products and have them readily available, according to Prologis. In addition, supporting businesses in the supply chain system such as 3PL, transportation, warehousing and logistics are also expanding speedily to cope with the velocity of growth. Consumers are more demanding than ever before with the emphasis now placed on faster delivery time at minimised or no delivery costs. This has driven increased pressure for last mile logistic networks of smaller fulfilment centres strategically located within infill markets supported by larger regional distribution centres on peripheral locations. As a result, land prices have increased significant across the board, but more so in for locations closer to population hubs where there is greater density and higher competition from alternative uses. On that note, Colliers International believes the case for multi-story warehousing in urban areas will strengthen over the next few years as it addresses both the scarcity and high cost of land. Investors remain bullish on industrial property Against the backdrop of the strong fundamentals in the industrial property market, investor demand has remained particularly buoyant. The strong flow of capital into the Australian industrial sector now stems from a diverse range of investor types; including, local privates, property syndicates, institutional investors and offshore buyers. This strong demand, however, is being restrained by the lack of stock being available, particularly the lack of portfolio opportunities. As a result, yields have continued to compress across the board over the past 12 months. However, Colliers International expects to see the polarisation of yields between capital cities to be more prominent with the East Coast markets of Sydney, Melbourne and Brisbane seeing stronger capital appreciation than Perth and Adelaide. Industrial Research & Forecast Report Second Half

8 Research & Forecast Report SYDNEY Industrial Second Half 2018 By Alex Pham Director Research MARKET HIGHLIGHTS The positive economic outlook for New South Wales and an unprecedented level of infrastructure investment remain to be the primary catalysts for growth in the Sydney industrial market. As demand continues to outstrip supply and vacancy declines, developers are becoming more confident with speculative developments, which are achieving strong leasing results prior to completion. Sydney Average Land Value Land Value ($/sqm) $1,600 $1,400 $1,200 $1,000 $800 $600 $400 $200 $0 Sep-08 Mar-09 Sep-09 Mar-10 Sep-10 Mar-11 Sep-11 Mar-12 Sep-12 Mar-13 Sep-13 Mar-14 Sep-14 Mar-15 Sep-15 Mar-16 Sep-16 Mar-17 Sep-17 Mar-18 Sep-18 Average Land Value Average Annual Growth Rate Source: Colliers Edge Average Yields by Market-Prime Yield (%) 10.0% 8.0% 6.0% 4.0% 30.0% 20.0% 10.0% 0.0% -10.0% -20.0% -30.0% Annual Growth Rate (%) The average prime yield for prime industrial assets in Sydney has tightened by approximately 48 basis points over the past 12 months to 5.26 per cent as at September Overview 2.0% 0.0% Sep-08 Mar-09 Sep-09 Mar-10 Sep-10 Mar-11 Sep-11 Mar-12 Sep-12 Mar-13 Sep-13 Mar-14 Sep-14 Mar-15 Sep-15 Mar-16 Sep-16 Mar-17 Sep-17 Mar-18 West North South South West Inner West North West Central West Outer West Source: Colliers Edge Sep-18 The positive economic outlook for New South Wales and an unprecedented level of infrastructure investment continue to be the primary catalysts for growth in the Sydney s industrial market. The strong economic outperformance of NSW is expected to be maintained over the next three years, with Gross State Product forecast to advance by 2.75 to 3.0 per cent during this period, exceeding the trend growth by 25 to 50 basis points. To support this growth, the Government has embarked on a massive infrastructure investment program spending over $72.7 billion on projects across the state over the next four years. This is the highest level of investment in infrastructure the state has ever experienced and will have significant spillover benefits to the industrial market, both in terms of increased demand and value uplifts. Amongst the mega-projects already underway are Sydney Metro Northwest ($8.3 billion), Sydney Metro City & Southwest ($12.5 billion), WestConnex ($16.8 billion), NorthConnex ($2.9 billion) and various stages within the Western Sydney Infrastructure Plan ($3.6 billion). In addition, construction has commenced at Moorebank Intermodal Terminal ($1.5 billion) and the Northern Road Upgrade ($1.6 billion) whilst earthworks at Western Sydney Airport ($5.3 billion) are set to begin by the end of More recently, the announcement of the Sydney Metro West project connecting the Sydney CBD and Parramatta with a future extension to Western Sydney Airport will be a game changer for the Western Sydney industrial corridor. Besides improvements in economic fundamentals and infrastructure, the rise of E-commerce and Omni-channel retailing is providing further support for the industrial market. Online retail sales growth has exceeded 35 per cent per annum over the past two years, according to ABS data, and the speed of penetration is expected to rise over the coming years as consumer preference continues to shift towards online shopping. Consequently, third party logistics providers (3PL) and omni-channel retailers have been the most active industrial tenants in Sydney over the past 12 months. Food retailers are also having a growth spurt off the back of the resilience of non-discretionary spending, which have outperformed discretionary spending in recent years. 8

9 As demand continues to outstrip supply and vacancy declines, developers are becoming more confident with speculative developments, which are achieving strong leasing results prior to completion. According to Colliers Research s analysis, all speculative developments in Sydney over the past year had been leased prior to completion, reflecting the strong demand for this type of product. The buoyant development activity amid a shortage of developable land is pushing land prices to new heights. Land values across Sydney have increased by 14.5 per cent over the past 12 months. Rental growth, however, continues to lag increases in land prices, although conditions varied greatly across the sub-precincts. The average prime net face rent for Sydney has increased by 2.3 per cent to $144/sqm as at September Prime incentives declined by 1 percentage point to 10 per cent resulting in net effective rental growth of 3.3 per cent. Stronger face rental growth was recorded in the secondary market, where face rents advanced by 5.5 per cent over the past 12 months to $124/sqm in September Secondary incentives are currently between 10 to 11 per cent. Despite the seemingly disconnection between land prices and rental growth, Colliers International is of the view that developers have remained comfortable with new developments for several reasons: Active developers have been tapping on their current land banks, which carry historical book values, The consistently low interest rates have alleviated pressure on profit margins, The declining vacancy has translated to a lower risk premium and lower hurdle rate, and Total returns are being driven by expectations for capital gains on the back of further yield compression. Looking forward, the future direction of land prices is dependent on three factors: The costs and speed of servicing existing un-serviced industrial zoned land, The amount of industrial zoned land being released at the Western Sydney Aerotropolis (formerly known as Western Sydney Airport Growth Area), and The timing of these releases. Colliers International analysis reveals that whilst the remaining balance of serviced industrial zone land across the Greater Sydney region can accommodate approximately 3 to 4 years worth of developments at the current take up rate which is relatively low by historical standards, the amount of un-serviced industrial zoned land is equivalent to approximately 23 or 24 years of the current absorption rate. Nevertheless, a significant portion of the developable land bank is currently held by private owners who are not under any significant pressure to activate their land holdings. In addition, delays by councils and uncertainties surrounding infrastructure contributions further exacerbate the stalemate. The Department of Planning and Environment has recently released the Land Use and Infrastructure Plan for the Western Sydney Aerotropolis consisting of nine precincts. The focus of initial planning will be on three precincts, including; the Aerotropolis Core, South Creek and the Norther Gateway. Whilst detail planning is yet to be finalised, expectations are for the Northern Gateway Precinct (1,120 hectares), to be designated primarily for industrial and logistics uses with limited scope for residential development in the immediate surrounds of transport stations. The rezoning process is expected to commence following the release of the Final Plan and will be finalised before the end of Colliers Internationals believes the zoning outcomes of this plan would be an important influencing factor on land prices from 2020 onwards Percival Road, Smitfield Sold on behalf of GM Property Group for $44.8m Industrial Research & Forecast Report Second Half

10 Meanwhile, the investment market is being fuelled by robust appetite for industrial and logistic assets from both global and domestic investors. The intensified competition amid a lack of available assets for sale has resulted in further compression of industrial yields across Sydney. The average prime yield for prime industrial assets in Sydney has tightened by approximately 48 basis points over the past 12 months to per cent as at September For secondary assets, yields have compressed by 45 basis points over the year to per cent currently. With a limited number of assets expected to hit the market over the next 12 months, yields are forecast to remain tight for some time. Institutional owners with development capability are increasingly turning their focus on new developments to grow their portfolios. Colliers International expects alternative strategies such as sale and leaseback, asset swaps, brownfield sites acquisition of existing property mandates in infill markets will be become more prevalent going forward. Submarkets West Leasing conditions across the Western industrial markets, comprising the Inner and Central West, North West, South West and Outer West precincts, have remained solid over the past six months, with demand outstrip supply for quality products. Precincts that saw stronger tenant enquiries were those around major road intersections driven by the quest for supply chain efficiency. Occupiers in the 3PL, Transport, Food and Fast Moving Consumer Goods (FMCG) sectors remain the primary drivers of demand in the Western market. Against the back drop of this strong demand, net face rent across the Western industrial markets have registered an average growth rate of circa 3.6 per cent on average over the 12 months, albeit the levels of growth varied greatly across the submarkets reflecting the localised supply-demand dynamics. The Central West was the best performing sub-market in the West with net face rents rising by 11.8 per cent on average over the past year. This was a direct result of the diminishing stock due to stock withdrawals for alternative uses in conjunction with rising demand for last mile logistics in areas with proximity to population hubs. On the same note, the South West sub-market, which is strategically positioned to benefit from improved transport upgrades, recorded robust net face rental growth of 6.1 per cent on average over the past 12 months. These trends reaffirm the strong tenant preference for infill locations near transport nodes. On the other hand, the Outer West precinct, where new supply was more prevalent recorded softer net face rental growth in line with inflation. Incentive in the Outer West are being offered of up to 15 per cent for prime stock due to sustained development activity. Elsewhere in the Western markets, average incentive levels are consistent around 10 to 12 per cent. Our analysis of leases since 2017 reveals that whilst there is still a strong tenant preference for existing buildings, the lack of larger options are driving occupiers with larger requirements to the pre-lease market. The average size for pre-lease commitments was approximately 16,500sqm compared to an average of circa 9,500sqm across all the existing facility transactions. Large industrial operators continue to emphasise on supply chain efficiency and increasingly implement the hub and spoke model with an integrated network of smaller fulfilment centres strategically located within infill markets supported by larger regional distribution centres on the city outskirts. As a result, proximity to infrastructure is still the key consideration on all decisions in relation to warehouse and distribution locations. Tenant migration to the Outer West is expected to continue due to stock withdrawals, declining affordability and lack of transport efficiency across the Inner West and North West markets. This will ensure a strong level of precommitment for the upcoming developments in the Outer West over the next 12 months. Industrial assets in the Western markets are highly sought after with local and offshore investors fiercely compete for quality assets and driving yields down further. Prime yields in the Western markets have sharpened by over 50 basis points over the past 12 months to now range between 5.0 and 5.25 per cent. The notable sale of a 50 per cent stake in Calibre Eastern Creek is a testament of how low yields can go in the current investment climate. Mirvac Industrial Logistics Partnership (MILP) purchased the interest for a total consideration of $125 million, excluding the present value of outstanding incentives, at an equivalent yield of 5.10 per cent and a passing yield of 5.14 per cent with a 6.19 year WALE. Average Land Value Western Sub-Markets Average West Market Rent and Incentive Land Value ($/sqm) $700 $600 $500 $400 $300 $200 $100 $0 Sep-08 Mar-09 Sep-09 Mar-10 Sep-10 Mar-11 Sep-11 Mar-12 Sep-12 Mar-13 Sep-13 Mar-14 Sep-14 Mar-15 Sep-15 Mar-16 Sep-16 Mar-17 Sep-17 Mar-18 Sep-18 Rent ($/sqm) $140 $120 $100 $80 $60 $40 $20 $0 Mar-08 Sep-08 Mar-09 Sep-09 Mar-10 Sep-10 Mar-11 Sep-11 Mar-12 Sep-12 Mar-13 Sep-13 Mar-14 Sep-14 Mar-15 Sep-15 Mar-16 Sep-16 Mar-17 Sep-17 Mar-18 Sep-18 12% 10% 8% 6% 4% Incentive (%) 2% 0% South West Inner West North West Central West Outer West Average West Incentive Average West Net Effective Rent Average West Net Face Rent Source: Colliers Edge Source: Colliers Edge 10

11 298 Horsley Road, Milperra NSW Sold on behalf of Lennox Industrial Inc for $52m North Net face rents in the North precinct have remained relatively stable over the past 12 months, with effective rents being driven by falling incentives. Prime net face rents are around $200/sqm whilst secondary face rents are circa $164/sqm as at September However, effective rents have risen by 2.5 per cent due to declining incentives, which have fallen the past 12 months to around 8 to 10 per cent as at September With very limited stock available, tenants with larger requirements than 2,000sqm are being enticed to the Western precincts to take advantage of more affordable rents and availability of newer and larger spaces. The remaining occupiers in the market are mostly SME businesses focusing on higher value products such as pharmaceutical, medical and IT goods, or those with strong ties to the area. The only major availability in the North is the former Roche facility in Cromer with a total NLA of 26,000sqm, which is receiving strong interest from logistics and retail operators. The investment market was dominated by private investors with most of the transactions over the past six months in the sub- $50 million market due to the lack of institutional grade stock. Highlight deals include 49 Herbert Street, St Leonards sold for $13 million ($7,076/sqm of NLA) and 2 Byfield Street, Macquarie Park transacted for $15 million ($7,194/sqm). Prime yields have decreased by 25 basis points over the past 12 months to 6.5% as at September 2016 whilst secondary yields have contracted by 75.5 basis points to around 5.25%. Competition from alternative uses saw industrial land values climbed by 19.4% over the past year to edge over $2,000/sqm in September South The continued depletion of stock and industrial land in the South continue to drive rents up and encourages tenants to reconsider their location strategies. Demand has cascaded further out towards Sutherland and the South West, in turn driven up rents and land values in those areas. With industrial users being starved for choices, net face rents in the South market have escalated significantly across the board, but more so in the secondary market where the lack of stock is more severe. Secondary net face rents have increased by 12.6 per cent over the past 12 months to average around $157/sqm as at September Incentives have declined to average around 7 to 12 per cent currently. Strong rental growth was also observed in the prime market, which registered an increase of 5.6 per cent in net face rents over the past 12 months to average around $188/sqm. Land prices in the South rose by 10.4 per cent on average over the past 12 months to $2,125/sqm as at September Rising land values are putting further restriction on supply growth, which is feeding back to pent-up demand and rising effective rents. The high land costs are forcing landlords to focus on maximising floor space ratios (FSR) and floor efficiency. As a result, multi storey industrial estates are expected to be more prevalent in the market within the next few years. This type of product will certainly be attractive to port-related businesses or occupiers who need to remain close to the CBD and public amenities to attract highcalibre employees. Nevertheless, there are still considerations in relation to flight path and height restriction for the area. Industrial Research & Forecast Report Second Half

12 Research & Forecast Report MELBOURNE Industrial Second Half 2018 By Sarah Walker Manager Research MARKET HIGHLIGHTS Trend of occupiers relocating West seeking more affordable and modern warehouse accommodation Institutions activating large land holdings in the west with the next wave of developments Major new infrastructure announcements including the new Melbourne Airport rail link Overview The total investment transactions for 2018 currently sitting at a total of $ million, with sales concentrated in the outer east and the west. The solid capital inflow from offshore and onshore groups has let to further yield compression for both prime and secondary grade assets, averaging 5.79 per cent and 6.33 per cent respectively. Yield compression was stronger for secondary grade assets at 12bps (compared with 11bps for prime), as there has been a lack of core product on the market. Lack of supply of built industrial investment product in Melbourne is necessitating the move for long-term investors to acquire land holdings, from which they will be able to acquire investment product. The year saw a number of announcements of large major infrastructure projects including the Airport Rail Link, North East Link and the suburban rail loop. The suburban underground rail link is the biggest public transport project in Australian history in dollar terms, costing approximately $50 billion and will take 30 years to build. It is aimed to reduce congestion across the city providing a long term pipeline of economic activity and allowing for Melbourne s strong population growth. The next twelve months will see an increase in development from larger institutions particularly in the West sub-market as well as development progression in Fisherman s Bend and Arden precincts in the Fringe Market following the announcements of both structure plans. Industrial Land Values (excluding City Fringe) $500 $450 $400 $350 $300 $250 $200 $150 $100 $50 $0 Sep-05 Mar-06 Sep-06 Mar-07 Sep-07 Mar-08 Sep-08 Mar-09 Sep-09 Mar-10 Sep-10 Mar-11 Sep-11 Mar-12 Sep-12 Mar-13 Sep-13 Mar-14 Sep-14 Mar-15 Sep-15 Mar-16 Sep-16 Mar-17 Sep-17 Mar-18 Sep-18 Source: Colliers Edge North South East West Outer East Industrial Land Values (excluding City Fringe) $500 $450 $400 $350 $300 $250 $200 $150 $100 $50 $0 Sep-05 Mar-06 Sep-06 Mar-07 Sep-07 Mar-08 Sep-08 Mar-09 Sep-09 Mar-10 Sep-10 Mar-11 Sep-11 Mar-12 Sep-12 Mar-13 Sep-13 Mar-14 Sep-14 Mar-15 Sep-15 Mar-16 Sep-16 Mar-17 Sep-17 Mar-18 Sep-18 Source: Colliers Edge North South East West Outer East Average Prime and Secondary Net Face Rents (5,000sqm+) $ $ $80.00 $60.00 $40.00 $20.00 $0.00 Sep-05 Mar-06 Sep-06 Mar-07 Sep-07 Mar-08 Sep-08 Mar-09 Sep-09 Mar-10 Sep-10 Mar-11 Sep-11 Mar-12 Sep-12 Mar-13 Sep-13 Mar-14 Sep-14 Mar-15 Sep-15 Mar-16 Sep-16 Mar-17 Sep-17 Mar-18 Sep-18 Source: Colliers Edge Average Prime Average Secondary 12

13 Submarkets City Fringe As a result of the increased underlying land values in the City Fringe sub-market, statutory outgoings have continued to climb and in some areas, including Fishermans Bend, land tax has doubled. This is driving occupiers to relocate West seeking more affordable and modern warehouse accommodation. Incentives have tightened for both prime and secondary grade stock by one percentage point over the last quarter to 10 per cent and 12 per cent respectively. The final Arden Vision was released in July 2018 providing indicative timing and scope for the future of the Arden Precinct. The document outlines the planning process and delivery of the Arden precinct which will occur across state and local government in consultation with local residents, businesses and landowners. Once development is underway, a significant focus from other City Fringe markets such as Cremorne, Richmond and Abbotsford is expected to shift to the Arden precinct. The planning framework for Fishermans Bend was recently released providing a guide development of the area into a residential and employment hub. This information will provide some key landowners with the confidence to sell knowing the true underlying value of their land based on future development capacity. The Port of Melbourne launched its largest leasing campaign in recent history, with eight separate opportunities totalling more than 165,000 sqm ranging from 5,500sqm to 68,600sqm. Development in this area is largely driven by population growth, which will increase the amount of trade that will need to be accommodated. These port properties are located on Coode Road, Enterprize Road and South Wharf, all within 4 kilometres of the CBD. Increasing land values which directly impact rents, has seen larger warehouse and logistics occupiers moving further out. The flight to quality is resulting in increasing secondary stock vacancy in the Fringe Kitchen Road, Dandenong VIC Sold on behalf of a private client for $7.06m Industrial Research & Forecast Report Second Half

14 North A tightly held market in the Northern sub-market has resulted in prime grade stock in the most demand. Industrial property is being snapped up quickly, with new buildings that are developed to be quickly sold. In the last 12 month, the North sub-market has seen an uplift in land prices evident in the sale of Lot 8, Connect North Business Park Epping comprising of 2,100sqm at the end of 2016 for a rate of $272.5/sqm to the recent sale of Lot 759, Alliance Business park Epping comprising of 2,140sqm for a rate of $402/sqm in Q2 of this year. These two very comparable lots show a 47.5 per cent uplift over this 18 month period. Further uplift in land values in Q3 of this year evident when MAB released 25 lots to the market reaching rate of $480/ sqm for lots 712 and 713 Alliance Business Park (1,880sqm and 1,782sqm respectively). In the same estate along the main road of Edgards Road, prices reached in excess of $500/sqm such as Lot 21, Alliance Business Park comprising 2,227sqm for a healthy rate of $536/ sqm. These sales showcase the underlying appetite for land amongst both developers and occupiers. Due to the lack of transactions in this tightly held market, face rentals have been relatively flat with more expected to come online for the remainder of the year. Face rents remained at $80/sqm for prime and $60/sqm for secondary stock. 1E Mace Way, Melbourne Airport achieved rents of $95/ sqm for A Grade stock and incentives of 14 per cent on a 7 year lease. Building A & B, 40 Glenbarry Road, Campbellfield achieved face rents of $60/sqm for B Grade stock with 14 per cent incentives. Rising land values has resulted in a trend towards owner occupying, further fuelled by low interest rate at present. There is a current lack of new supply coming onto the market within the northern suburbs. 410 Cooper Street, Epping is currently being rezoned for industrial use and expected to come to market in 2019/2020. Frasers purchased the parcel and are still undecided on what they will do with the 62 hectares. The tight market has seen healthy results for B grade assets, Fillo Drive Somerton with low clearance comprising of 3,430 sqm sold in September for $3.6 million sold to an owner occupier. Due to new stock in short supply located closer to the city coupled with new plans for improved road linkages such as the North East link, Airport Rail Link and Tulla Widening, tenants are happy to consider development in locations further north. Merrifield Business Park has opened its doors to the market and has since secured German hypermarket giant Kaufland who purchased 28 hectares looking to building their DC there. Yields for both prime and secondary grade stock have compressed 25 basis points currently sitting at 6.25 per cent and 7.25 per cent respectively. 23 Scanlan Drive Epping sold by Frasers Property transacted for $15.7 million achieving a tight yield of 6.2 per cent. The transaction setting 30 days after purchase demonstrating that regardless of perceived weakness, investments are in high demand in this current market. Scarcity of developable industrial land and led to record breaking prices achieved in recent times Southern Road, Mentone Sold on behalf of a private client 14

15 West Face rents in the West sub-market have remained relatively stable over the past 6 months remaining at an average of $79 per sqm for prime and $60 per sqm for secondary grade stock. Incentives also stayed stable at 20% for prime and 15% for secondary. The notable sale of the Kmart Distribution Centre in Truganina recalibrated the market with respect to yields. It transacted at $119 million to Logos Property Services on a 5.5% yield. Previously it transacted at $94.1 million 4 years prior representing a 27% growth over that time frame. Average yields for prime stock has reduced 25 basis points to 6.00% and remained steady for secondary at 7.25%. Outgoings for prime grade assets and secondary grade assets were unchanged from the last 6 months, decreasing over the last 12 months as new designed buildings and existing buildings have been upgraded to be efficient designs. Landlords have trended towards speculative developments seen in 2 Key West Place Derrimut still under construction and will comprise of 17,500sqm of speculative fit out. A development of this scare was in demand in this market coupled with the popularity for speculative developments is evident in that all 5 spaces were leased prior to halfway through construction. The private developer achieved healthy face rentals of approximately $80 per sqm ranging from 5 to 10 years. Due to pent up demand, institutions are now starting to exhaust their land holdings after a period of waiting. Traditional developers including Dexus, Charter Hall, Goodman and Frasers are activating their next land bank which will provide the next wave of speculative construction to come online in the next 12 months. Some of these major new developments, to be speculatively built, include: Dexus Laverton North Estate in Truganina comprising of 30,000 sqm Charter Hall s Drystone Industrial Estate in Truganina comprising of 7,000 sqm Goodman s West Industry Park in Truganina comprising of 12,000 sqm Frasers Wyndham Estate in Truganina comprising of 30,000 sqm Land values in the West have experienced strong growth over the last 6 months of 5.77 per cent averaging $275 per sqm. South East and Outer East Land values in the South East have grown more than all the submarkets 8.82 per cent over the last 6 months to September 2018, averaging $463 per sqm. In the outer east, land grew only 1.14 per cent to $443 per sqm for the same period. At present, rental values which have remained relatively flat are not keeping in line with increasing land values. We expect that rents will increase and compress and as an effect of this, incentives will also compress. Effective rents in the south east for both prime and secondary stock have declined from the levels that they were at over 10 years ago. Incentives have gradually risen over this period to reach 19 per cent for prime and 13 per cent for secondary grade. Coupled with growing face rental growth has kept yields to continue tightening. 13 Gilbert Park Drive, Knoxfield transacted for $6,705,000 million with a 5.5 year lease remaining on a 6.7 per cent yield. In the current market, investors are seeing greater investments for properties with a year in place than for vacant possession for properties greater than 5,000 sqm. In contrast, Henderson Road, Knoxfield transacting for $9,100,000 a vacant possession sale representing a much lower rate per sqm in building area. In the Outer East, tightly held suburbs include Knoxfield, Scoresby and Rowville with few opportunities available. Major stock has been quickly leased up including Caribbean Business Park, Scoresby which comprises of over 230,000 sqm of office /warehouse buildings and found office towers totally 32,000 sqm. The Business Park is now fully let with no industrial opportunities available. 57 Corporate Drive, Heatherton was also leased up quickly with low incentives of 10% and healthy face rentals achieved of approximately $87.50/ sqm. In the South East reduced land available has pushed up land values, the sale of 117 Frankston-Dandenong Road, Dandenong a development opportunity achieving a price of $4,448,000 representing a rate of $556/ sqm on land with a short term lease in place Southern Road, Mentone represented a large infill site sold on behalf of Hella transacting for an undisclosed amount on a sale-leaseback to a major institutional investor. Yields were unchanged over the quarter, a tight yield of 5.9 per cent was achieved in the sale of Woodlands Drive, Braeside which was sold to Xin Wang. Industrial Research & Forecast Report Second Half

16 Research & Forecast Report BRISBANE Industrial Second Half 2018 By Alex Pham Director Research MARKET HIGHLIGHTS Strong population growth combined with low unemployment is expected to drive consumption of goods and retail spending, which in turn translates to increased demand for logistics and industrial space. Over the 12 months to September 2018, the average price for industrial land in Brisbane has risen by 9.2 per cent to $258/ sqm. Prime yields have tightened by 20 basis points over the past 12 months to average around 6.13 to 6.57 per cent as at September Overview The Brisbane industrial market is thriving on the back of improved economic conditions and robust population growth driven by interstate migration. Queensland s economic growth is forecast to accelerate from 2.5% in to 3.0% by with growth boosted by rising exports, improving business investment and solid employment growth. The value of Queensland s merchandise exports has increased by 10 per cent over the year to $75.4 billion in July 2018, making the state Australia s fastest growing exporter and accounting for almost a quarter of the nation s total. Business investment across the state is rebounding strongly off the back of the renewable energy sector and is forecast to grow by an average of 6.5 per cent over the next five years. Employment growth is forecast to advance to 2.1 per cent between 2018 and 2022 translating to an average of 50,000 new jobs every year. This is the strongest job growth in the state in more than a decade. Improving economic conditions and employment opportunities are encouraging more people to Queensland, with the state s population growing at 1.7 per cent over the past 12 months outpacing the national average. Much of this growth is derived from interstate migration with over 24,000 people having migrated to the Sunshine Queensland Business Investment $ Billion Source: Deloitte Access Economics, Colliers International State from within the country last year. In fact, about one in every five interstate migrants in Australia last year have moved to Queensland. Despite the rising population, the unemployment rate remains low and is and expected to trend down further towards 5.1 per cent over the next five years from 6.2 per cent currently, indicating employment growth is still outstripping labour supply. Strong population growth combined with low unemployment is expected to drive consumption of goods and retail spending, which in turn translates to increased demand for logistics and industrial space. The compelling economic proposition and positive market outlook are attracting investors into the Queensland s industrial market. Despite the buoyant demand, investment volumes in 2018 are expected to be relatively constrained compared the previous year due to a severe lack of available assets being placed on the market. Over $370 million worth of industrial transactions have settled over the year to date, which is about less than 40 per cent of the total sales value seen in The strong investor demand is spreading over to secondary areas due to availability of value-add opportunities. Capital is well supported by a diversity of investor types, from wealthy privates and syndicates to large institutional owners and overseas investors, who are all focusing on 16

17 gaining exposure to the Brisbane market. Offshore investors were particularly acquisitive, only to be hamstrung by limited availability and fierce competition from local buyers. Sale and leaseback and off market deals are expected to become more prominent in the market over the next 12 months. The strong investor demand resulted in further increases in prices and declining yields across the board. Prime yields have tightened by 20 basis points over the past 12 months to average around 6.13 to 6.57 per cent as at September 2018, whilst capital values have increased by 6.6 per cent over the corresponding period. In the secondary market, yields have compressed by more than 30 basis points over the year to now sit between 7.59 and 8.31 per cent. Consequently, capital values for secondary assets have increased by 4.3 per cent year on year on average. Land prices have also increased considerable on the back of the strong demand for development sites. Over the 12 months to September 2018, the average price for industrial land in Brisbane has risen by 9.2 per cent to $258/sqm. Excluding the Yatala region, land prices average around $324/sqm, up 8.1% YoY. Despite the rapid escalation in land costs, rental growth has remained relatively modest. The average prime net face rent has increased by 2.2 per cent over the past 12 months to $108/sqm and incentives are stable at around 15 to 16 per cent. Secondary net face rents have remained largely unchanged for the past year at circa $85/sqm with incentives at around 17 per cent. Colliers Research believes the strong appreciation in land values without equivalently strong rental growth can be attributed to several factors, including; diminishing availability of serviced land, particularly in the ATC region, tightening yields and the concentration of ownership of development sites in the hands of a few owners. Looking forward, with these conditions remaining in place, Our expectations are for the pressure on land prices to remain for some time and rental growth is anticipated to improve. Submarkets Australian TradeCoast (ATC) Limited The Australia TradeCoast Region continues to see robust tenant demand, but also suffers from an acute lack of supply. The limitation of available sites manifested in considerable increases in land prices over the past 12 months, rising by 16.4 per cent to average around $300 to $480/sqm (2.5-hectare sites) in September Prices for smaller serviced lots, however, have exceeded $500/sqm due to the strong competition for small size warehouses. There are new developments being constructed at the airport, but it will be some time before they will be available and the pressure on prices is expected to remain. The strong land take-up rate has been underpinned by the solid pre-commitment levels and strong demand from construction and consumer goods sectors. High quality speculative developments continue to achieve favourable leasing results with operational efficiency and proximity to infrastructure being key criteria for tenants location decisions. Rents are holding firm across the board with the mid-tier markets beginning to show signs of improvement. Prime net face rents are around $116/sqm as at September Effective rents have firmed up by 2.3 per cent as incentives were lowered from 15 per cent last year to 13 per cent currently. Secondary net face rents remained steady at around $93/sqm with incentive levels standing at 17 per cent. Investment stock has remained tightly held in the ATC region with very few assets being available for sale. Prime yields have declined by around 25 basis points over the year to now range between 6.00 and 6.45 per cent. Secondary assets are being traded at yields of between 7.20 and 7.55 per cent in September 2018, approximately 13 basis points lower than a year ago. Capital values have increased by 4.0 and 1.7 per cent pa on average for prime and secondary assets respectively. 100 Hoepner Road, Bundamba QLD Sold on behalf of a private client for $12.5m Industrial Research & Forecast Report Second Half

18 Brisbane Industrial Prime Grade Yields by Precinct 11.00% 10.00% 9.00% 8.00% 7.00% 6.00% 5.00% Brisbane Prime Capital Values by Precinct $3,000 $2,500 $2,000 $1,500 $1,000 $500 $0 Source: Colliers Edge ATC Northside Southside SouthWest Yatala Source: Colliers Edge ATC Northside Southside SouthWest Yatala North and Outer North Land prices for 2.5-hectare sites in the North and Outer North are now between $235 and $360/sqm, 1.7 per cent higher than a year ago. Moving forward, land availability is expected to become a key constraint for developers and Colliers Research expects the lack of supply to place further upwards pressure on pricing. As the region has relatively high exposure to SME tenants the Strata market is performing well with high volumes of lease transactions between sqm around the Banyo, Geebung and Northgate regions. Prime net face rents in the North region are currently around $105- $115/sqm and incentives are between 12 to 17 per cent. Secondary spaces are achieving net face rents around $75 to $95/sqm with 14 to 20 per cent incentives. Demand from owner occupiers is improving with several major sales sub-$15 million being contracted over the third quarter of this year. Recent transactions include 115 Frederick Street, Northgate sold for $5.7 million ($771/sqm) and 9-17 Bimbil Street, Albion transacted at $2.78 million ($2,311/sqm). Prime yields have firmed by around 18 basis points over the last 12 months to now sit between 6.15 and 6.50 per cent in September Yields for secondary assets in the North and Outer North precincts are around 7.57 and 8.50 per cent. South The South market is receiving strong investor and occupier interest due to key staffing requirements and infrastructure upgrades. The improved connectivity to major infrastructure along the Northern and Southern trade corridor has attracted demand from major logistics, transport and warehousing groups at the introduction of a range of new warehouse and distribution facilities in the region. A growth rate of 3.0 per cent was recorded for net face rents across the precinct, which sit at around $ /sqm as at September Effective rents were boosted by 3.6 per cent thank to lowered incentives. Secondary net face rents were also up by 3.0 per cent to stand between $75 and $95/sqm. Incentive levels for secondary assets are currently between 15 and 20 per cent. The appetite for assets in the South by investors and owner occupiers is driving improvement in capital values across the board, which increased by 12.4 and 7.9 per cent for prime and secondary assets respectively. Yields for A-Grade assets have sharpened by 22 to 23 basis points over the past 12 months to range between per cent in September Secondary industrial buildings are trading at per cent yields on average, 38 basis points below last year s levels. 18

19 South West Take-up in the South West region has been driven by large pre-commitment deals by occupiers in wholesale, transport and postal sectors. One of the largest deals in the South West in the quarter was Winc leasing 14,867sqm at Dexus 301 Orchard Road, Richlands on an 8-year term. Australia Post has also pre-committed to a new 50,000 sqm distribution and sorting centre at Redbank Motorway Estate. The Hi-Tech centre is expected to be completed by December 2019, making the region a rapidly growing logistics hub. The South West s prime net face rents are averaging around $105-$115/sqm and incentives are around 15 to 20 per cent as at September Secondary net face rents are currently around $75 to $90/sqm and incentives range between 15 to 20 per cent. The strong demand for development sites and competition from alternative uses have resulted in a significant increase in land values in the South West. The average land price for a 2.5-hectare site rose by 12.1 per cent over the past 12 months to average around $270-$330/sqm. Rising land costs are also pushing property values higher and yields down. Prime yields have compressed by 20 basis points from last year to stand between 6.25 and 6.75 per cent today. Stronger tightening occurred in the secondary market where yields were down by 38 basis points to currently between 7.5 and 8.5 per cent. A notable transaction recently was 100 Hoepner Road, Bundamba sold to TAE Gas Turbines for $12.5 million. The wellpositioned former Masters site with over 10,000sqm of building improvements was transacted at a rate per NLA of $1,243/sqm. Yatala Enterprise Area (YEA) The Yatala Enterprise Region is benefiting from cascading demand from the Gold Coast and other precincts in Greater Brisbane due to affordability and availability of development sites. Industrial land in the YEA is amongst the lowest in Brisbane, costing only $220 to $285/sqm as at September This is about 20 to 30 per cent cheaper than the other industrial precincts in Metropolitan Brisbane. Occupancy costs are also more affordable with prime net face rents ranging from $90 to $100/sqm and attractive incentives are on offer at 14 to 19 per cent. Secondary net face rents are between $70 to $90/sqm and incentives remain at 15 to 20 per cent. Prime and secondary yields in the YEA are currently around % and % respectively. Looking ahead, as infrastructure and transport networks continue to improve, the YEA is well position to see increased tenant demand and investor interest, which in turn would support rental growth and capital values. 115 Crockford Street, Northgate Sold on behalf of a private client for $10.7m Industrial Research & Forecast Report Second Half

20 Research & Forecast Report ADELAIDE Industrial Second Half 2018 By Kate Gray Director Research MARKET HIGHLIGHTS Sales activity boosted in the second half in part due to the abolishment of stamp duty Defence spending starting with offshore patrol vessel commencing Sonnen to set up manufacturing at former GMH site in SA Overview percent stake was sold to Straits trading for $130.5 million with the vendor Commercial and General retaining a 20 percent stake. This has seen a shift of capital to more off shore sources with both Soilbuild and Straits Trading being based in Singapore. There are several larger listings currently on the market including the Coca- Cola Amatil site at Thebarton which are expected to transact this year further boosting sales volumes. Vacancy in the Adelaide industrial market has increased over the second half to an average of 4.8 per cent, up from 3.9 percent. Both the Outer North and Inner north markets have seen increases in vacancy with vacancy rates of 6.1 percent and 4.9 percent respectively. The increase in the Outer North is not unexpected with the transition from automotive use. It is likely that there will be further vacancy as the Holden site is repurposed and offered to the market for lease. There is continued momentum building in the Adelaide industrial market. This has been underpinned by significant investment in infrastructure, increased defence spending, and improved conditions for mining and energy investment. Investment in road infrastructure has been key along the North South Corridor with the Torrens to Torrens project and the Darlington interchange projects both nearing completion. The new State government has also committed to have the remaining projects, Darlington the Anzac Highway and River Torrens to Anzac Highway completed within a decade. The Adelaide industrial market has seen sales volumes significantly improve over the last quarter. This has brought total sales volumes in excess of $200 million of the year, which is well above average, but is unlikely to reach the heights of 2014 where over $329 million of assets were sold. These sales volumes have been assisted by the abolishment of stamp duty for commercial transactions which became effective on 1 July This has made Adelaide one of the most competitive places to do business and has resulted in renewed interest in the Adelaide market. The largest single sale for the year is the Ingham s facility, Port Wakefield Road, Burton which sold by Ascot Capital for $61.25 million and was purchased by Soilbuild. The second transaction is a portfolio sale including Kilkenny, Salisbury and Port Adelaide distribution centres, Bayswater DC in Vic and development land in Salisbury. An Crittenden Road, Findon SA Sold on behalf of a private client for $1.65m 20

21 Sub Markets Outer North The Outer North market is in a state of transition, with the closure and decommissioning of the Holden manufacturing plant last year. This was bought by the Pelligra Group and is being repurposed as Liongate Business Park which will include industrial, automotive use, mixed use retail, café park and museum. The most recent announcement is that Sonnen, a German battery manufacturer will set up at Liongate and will use this as the distribution facility for Australia, South Pacific and Asia. Drakes supermarkets are currently building a new $80 million distribution centre at Edinburgh North. Construction has commenced on the 45,000 sqm facility which is expected to complete in July A part of the new facility over $12 million will be spent on an automated picking system to help distribute over 23,000 products. Net face rents for prime and secondary space have remained stable with ranges of $60-$75/sqm for prime and $35-$50/sqm for secondary. Incentives have remained unchanged at percent across both prime and secondary space. Prime yields in the Outer North have tightened by 75 basis points over the last six months with a significant tightening at the lower end. The current range is 7.5 percent to 9 percent. Yields in the Outer North were out of step with other Adelaide sub-markets and this was mostly due to the risks around the exit of Holden. Now this has past, there is more stability in this submarket and yields are returned to be more in step with other Adelaide submarkets. Inner North Osbourne has seen an increase in government investment in infrastructure with $1.2 billion being spent on facilities to support the submarine project. As the ramp up to construction continues, we expect this will lead to further private construction for suppliers to these projects. Vacancy in the Inner North has increased from 4.1 percent to 4.9 percent over the last half. This however has not impacted rents, with net face rents growing by 2.4 percent for prime space and 3.8 percent for secondary space. Incentives have remained stable with prime incentives ranging between 5-15 percent and secondary percent. Yields in the Inner north market have remained stable over the last six months with prime yields between percent and secondary percent. West The West industrial market is tightly held and has the highest land values and is therefore a target for change of use from industrial to mixed use. Adelaide Industrial Vacancy South West Inner North Outer North Total Market 0.00% 1.00% 2.00% 3.00% 4.00% 5.00% 6.00% 7.00% 8.00% Sep-18 Mar-18 Source: Colliers International Total Adelaide Industrial Sales ($) $ Millions $350 $300 $250 $200 $150 $100 $50 $ st Half 2nd Half Source: Colliers International Prime net face rents in the West have remained stable with prime rents ranging $100-$150/sqm. Secondary net face rents however have grown by 3.2 percent and are between $60-$100/sqm. Incentives have also remained stable with prime incentives 5-15 percent and secondary percent. Prime yields in the West have remained stable over the past 6 months with prime yields between percent. Secondary yields however have tightened by 13 basis points over the last six months and 38 basis points in the last 12 months to range between percent. South Tonsley has continued to develop with further development under the Main Assembly Body (MAB). Ziess consolidated their operations with a state of the art $6 million 3,950sqm facility located under the main assembly building. Rents in the Inner South have remained stable with prime rents ranging $90-$130/sqm and secondary $55-$85/sqm. Incentives have also remained stable with prime incentives 5-15 percent and secondary percent. Yields in the inner south have remained stable over the past 6 months with prime yields between percent and secondary percent. Industrial Research & Forecast Report Second Half

22 Research & Forecast Report PERTH Industrial Second Half 2018 By Quyen Quach Senior Research Analyst Research MARKET HIGHLIGHTS Tenant enquiries improving Prime rents remain stable Vacancy continuing to improve Overview Resources sector and infrastructure spending boost jobs and enquiries The recovery in resource sector investment spend, strong government infrastructure spending combined with robust commercial building activity is starting to surface in industrial space enquiries. According to Colliers International s industrial sales and leasing executives, there has been a notable increase in enquiries from engineering and fabrication businesses seeking facilities with gantry cranes. Construction fell 14.1 per cent to 121,240, Professional, Scientific and Technical Services declined 1.6 per cent to 89,270 and Retail Trade fell 3.7 per cent to 119,970. Meanwhile, the sectors that experienced improvements were; Mining which grew 24.2 per cent to reach 105,240, Manufacturing up 21.4 per cent, Wholesale Trade growing 11.1 per cent, Transport & Storage up 7.8 per cent, while Agriculture, Forestry & Fishing employment increased 3.6 per cent. Going forward, Colliers is expecting further improvements in the labour market and subsequent industrial space demand, as the economy continues to improve. Residential dwelling vacancy is being absorbed and population growth is gradually improving. We anticipate that the improvement in the residential sector will consolidate, and flow through to a modest recovery in construction sector jobs, sometime over the next eighteen months. Recently released Australia Bureau of Statistics data, continues to show gradual improvement in the labour market. Overall employment numbers in WA have risen further from the 2016 trough. However, growth is patchy and some sectors have struggled to maintain stable employment numbers. Over the financial year, part-time positions grew at a faster rate than full-time. Part-time roles now account for 32 per cent of WA jobs in August 2018, up slightly from 31.7 in August This has led to the under-employment rate increasing to 10.8 percent in September 2018, from 9.6 per cent in March In the year to September 2018, the Australian Bureau of Statistics (ABS) reported a contraction in employment amongst several key sectors that occupy industrial space. The number of employees for 15 Ashby Close, Forrestfield, Western Australia Sold on behalf of Perdamon Group for $20.5m 22

23 1 Yeates Road, Kwinana Beach, Western Australia Sold on behalf of A & C Trading (WA) Pty Ltd for $3.85m Good absorption driving vacancy lower The vacancy rate continues to improve alongside employment numbers in the key sectors. Perth s industrial vacancy for industrial facilities (over 2,000sqm of building area) is now down to 7.8 per cent from 8.85 per cent in October In the year ending September 2018, Colliers estimates industrial space net absorption was approximately 241,500sqm. Secondary grade buildings continue to account for the vast majority of vacancy, with 69 per cent of the estimated vacancy coming from this class of space. Additionally, most of this vacancy is situated within the East and South regions of the Perth metropolitan area. These two regions accounted for 87.3 per cent of total secondary grade vacancy. Prime rents stable as vacancy gradually improves Prime rents have continued to stabilise, settling between $68.5/sqm and $85/sqm. Secondary rents, have been under the most pressure, declining to a range of $52.5/sqm and $73.5/sqm, due to high vacancy and competition for tenants. Strong demand keeps investment grade yields tight Average market yields softened marginally over the financial year 2017/18, driven by tighter credit conditions and an upward shift in interest rates. Even so, quality assets are still able to achieve sub-7 per cent yields due to strong institutional and syndication interests, combined with limited opportunities to acquire securely leased investment grade assets. There were 19 institutional grade asset transactions ($10m+) executed over 2017/18. This was the most recorded since 2014/15. Some of the major transactions that transpired over the past six months to June 2018 included: 307 Stock Road, Palmyra sold for $10.1 million. 1 Davison Street, Maddington sold for $9.4 million Ashby Close, Forrestfield sold for $20.5 million. 100 Chisholm Cr, Kewdale sold for $14.5 million. 4 Temperley Close, Welshpool sold at $12.65 million. 7 Sobek Pass, Cockburn Central sold for $10 million. Industrial Research & Forecast Report Second Half

24 Land values and new supply Land values are starting to exhibit signs of stability as WA s economic outlook strengthens. However, over the past twelve months, to September 2018, land values for Perth s core industrial areas have declined 1.97 per cent. Land releases in brownfield subdivisions received robust interest due to the limited availability of vacant industrial land close to the CBD. The reported turnover rates for these lots suggests the appetite for centrally located land remains good. However, metro fringe subdivisions have continued to experience weaker demand. Vacant land transactions fell to new decade lows, with transactions for amounting to 73 lots selling for a total value of $130.8 million. This was down from the 79 lots or $184.4 million in Development activity remains soft due to significant market vacancy in combination with lacklustre net tenant demand. The Perth market is likely to need further strong net absorption over the next year before vacant land transactions start to improve. Perth Industrial Space Supply (Buildings over 2,000sqm) Industrial Space Supply (sqm) 400, , , , , , ,000 50, Source: Colliers International Average Market Face Rents Average rents ($ per sqm) $140 $120 $100 $80 $60 $40 $20 $0 Sep-05 Mar-06 Sep-06 Mar-07 Sep-07 Mar-08 Sep-08 Mar-09 Sep-09 Mar-10 Sep-10 Mar-11 Sep-11 Mar-12 Sep-12 Mar-13 Sep-13 Mar-14 Sep-14 Mar-15 Sep-15 Mar-16 Sep-16 Mar-17 Sep-17 Mar-18 Sep-18 Prime Warehouse Rents (Net Face) Secondary Warehouse Rents (Net Face) Source: Colliers International Sub Market Update North Over financial year 2017/18 major investment transactions (+$3m) in the North region total $138.1 million from 19 transactions, which was up marginally from 18 sales worth $133m in 2016/17. North region vacancy was at 9.4 per cent in September 2018, with approximately 110,500sqm of space over 2,000sqm on the market. This was up from 99,770sqm recorded in March New supply of +2,000sqm industrial buildings in the north has been limited over the past year and only 6,500sqm of new space is expected to be delivered in There is no additional supply expected in Prime warehouse space rents remained between $70/sqm and $85/sqm over the September 2018 quarter, which is unchanged since March South There were 19 major investment transactions (+$3m) in the South over 2017/18 and these amounted to $174.9 million. This was down from 26 transactions totalling $223.5 million in 2016/17. South region vacancy is estimated to be 9.1 per cent or 330,835sqm in September 2018, which was lower than the 10.8 per cent or 385,255sqm recorded in October The South is expected to see delivery of 39,990sqm of warehouse space in 2018 (for buildings over 2,000sqm). Prime rents declined 1.6 per cent over the past year to average $75/ sqm in the September 2018 quarter. East Major transactional activity in the East region totalled $287.2 million from 31 transactions in the past year. This region and, to a lesser extent, the South tend to be the focus of major investors due to their proximity to major infrastructure (such as rail and seaport). Vacancy decreased to 6.5 per cent or 325,485sqm of stock, which is down from 7.4 per cent or 367,430sqm in October Only 31,390sqm of new supply in expected to be delivered in the East during This is a significant drop from the 105,700sqm supplied in However, 41,745sqm of space is expected to be completed in the East region during Prime warehouse rents in the East edged marginally lower over the past year, down 1.25 per cent since September 2017 to average $80/sqm. 24

25 Research & Forecast Report NEWCASTLE Industrial Second Half 2018 By Trent Robertson Director Industrial As the leasing market tightens, pre-lease construction activity is expected to continue into Q to Q Average rents for prime grade industrial buildings have remained steady after strong growth during the first half of MARKET HIGHLIGHTS Vacancy rates have fallen across the board for the Lower Hunter Region, with the lowest vacancy rates being experienced in the suburbs closest to the Port of Newcastle and in the suburbs closest to the M1 Pacific Motorway. Limited supply of industrial land has created increased competition from owner occupiers and speculative investors for serviced industrial lots. Increased levels of leasing enquiry, particularly from the transport and logistics sector. Tightening supply of prime grade investment properties resulting in yield compression. Strong competition for Industrial land Demand for industrial land in Newcastle and the Central Coast regions continues to strengthen with steady enquiry received on all estates currently managed by Colliers International. Limited supply of serviced lots ready for development within major industrial estates has created increased competition from owner occupiers and speculative investors, in turn driving demand for off-the-plan industrial lot sales. The value and lifestyle offering of the region continues to play a major part in generating leasing enquiry with significant enquiries being received originating from outside the Hunter Region. Many of these companies are those winning contracts for the public and private infrastructure projects and finding their work and clients in the region increasing to the point where they are looking to establish a permanent base with local staff. We have also witnessed increased enquiries from mining services related companies in recent months. This high level of demand is driving increased industrial land prices across the board, with price increases ranging from 10% to 30% during Estates on the M1 Pacific Motorway and close to Port areas are experiencing the greatest gains in land values, including Mayfield West s Steel River Estate, Morisset Business Park, Kooragang Port Link Estate and Beresfield s Freeway Business Park Leasing activity continues and vacancy rates tighten As a result of the improved confidence and strong activity in the construction, mining and port sector, Colliers International has experienced increasing levels of leasing enquiry during Q2 to Q3 2018, particularly from the transport and logistics sector Rural Drive, Sandgate Sold with an equivalent yield of 6.71%, Leased to Blackwoods Industrial Research & Forecast Report Second Half

26 The Steel River Estate Stage 10 Mayfield West, Newcastle Investor demand Demand from private investors and REIT s for premium grade industrial investment in the region continues to remain strong. Limited supply of investment assets with long WALEs and quality tenancy covenants has seen a compression in yields of prime grade assets in the prime industrial areas from 25 to 50 basis points currently averaging 6.95%. Yields for secondary grade stock also have firmed (currently at 8%) as investors are increasingly finding it difficult to secure assets with quality fundamentals. Key projects to drive future growth: 1. Container terminal for the Port of Newcastle moves a step closer The Port of Newcastle has developed a concept for a staged container terminal development at its Mayfield site. The planned Port of Newcastle container terminal will be a global gateway for regional Australia, delivering diversification and growth for the city of Newcastle and the Hunter Region. Reduced freight costs, increased freight efficiency and reduced infrastructure costs will be a catalyst for growth in the Hunter Region and will take a substantial load off Sydney roads and reduce NSW landside transport costs by an estimated $1.3 billion dollars. The Port of Newcastle has capacity to more than double its operations of 4,500 vessel movements to 10,000 vessel movements a year and capacity to handle 2 million TEU s per annum with a viable and competitive container terminal. 2. Joint Strike Fighter project commences in Newcastle The F35 Joint Strike Fighter project is due to commence at the RAAF Base Williamtown in Newcastle in December The Joint Strike Fighter program will involve a long-term service and maintenance program for Australia s fifth generation fleet of F35 Aircraft which will be the primary fighting aircraft in Australia. The project is expected to provide a program of modernisation and capabilities for the fleet of aircraft for the next 30 years and additionally provide service and maintenance of aircraft from Asia Pacific countries that buy F35 s. All 72 aircraft are expected to be fully operational by 2023, with two squadrons based in Newcastle. Over 50 Australian companies have directly shared in more than AU$1 billion in production contracts to date, with hundreds more Australian companies indirectly benefiting through supply chain work. Demand for industrial land and warehouse facilities and technology hubs is expected in precincts around the Williamtown RAAF base as the Strike Fighter project ramps up. 3. NorthConnex to benefit the Newcastle region NorthConnex is a nine kilometre tunnel linking the M1 Pacific Motorway at Wahroonga to the Hills M2 Motorway at West Pennant Hills. The nine kilometre tunnel will provide an improved link to Newcastle and the Central Coast from Sydney Metro areas. Motorists will soon be able to travel from Sydney to Newcastle with significantly less traffic lights and reduced travel times, and from Melbourne to Newcastle without a single set of traffic lights. The imminent completion of the NorthConnex has been welcomed by Newcastle and the Central Coast logistics companies with the expected reduced travel times meaning less fuel costs and more efficient logistics operations. The improved access to the Central Coast and Newcastle Region markets is expected to further increase the demand for warehousing and industrial land in these markets and with relatively low land prices, the Central Coast and Newcastle Region will continue to be an attractive option for Sydney based companies. The NorthConnex is due for completion Q

27 Research & Forecast Report NEW ZEALAND Industrial Second Half 2018 By Chris Dibble Manager Research & Communications MARKET HIGHLIGHTS The latest quarterly GDP growth rates show a 0.5 percent increase from the last quarter, above many predictions, and indicating a steady economic outlook. Latest results show a record low vacancy, a representation of continued strong tenant demand and a lack of suitable industrial stock. Industrial investor sentiment is slightly subdued this quarter although still strong across all three main centres. Overview The latest quarterly GDP growth rate was up by 0.5 percent from the last quarter, above many predictions, and indicating a steady economic outlook. However, business sentiment survey results continue to disappoint with further lacklustre results pointing to slower growth rates in coming quarters. Colliers International s latest Commercial Property Investor Confidence survey indicated an overall net positive 21 percent, of respondents expecting conditions to improve over the next 12 months across all sectors, down slightly from 23 percent recorded three months ago. Industrial investors sentiment remains buoyant across the three main centres of Auckland (58 percent), Wellington (41 percent) and Christchurch (16 percent). Nationally, the number of building consents for new industrial buildings (factories, industrial and storage buildings) remained steady. Looking regionally, the data suggests new supply is targeted in Auckland where the number of annual consents increased by 17 percent to 207 in 2018, which is backed up by a wave of speculative builds. Although the number of consents issued remained stagnant nationally, consents by value increased 17.3 percent, principally a reflection of escalating construction costs. Auckland Average Net Face Warehouse Rents Average Net Warehouse Rents ($/sqm) $140 $130 $120 $110 $100 $90 $80 $70 $60 Jun-10 Dec-10 Jun-11 Dec-11 Jun-12 Dec-12 Jun-13 Dec-13 Jun-14 Dec-14 Jun-15 Dec-15 Jun-16 Dec-16 Jun-17 Dec-17 Jun-18 Prime Secondary Overall Source: Colliers International New Zealand Industrial Confidence Survey Net Percent 70% 60% 50% 40% 30% 20% 10% 0% Auckland Wellington Christchurch New Zealand Jun-18 Sep-18 Overall Source: Colliers International New Zealand Industrial Building Consents (New) Value of Building Consents ($ millions) 1,400 1,050 1,200 1, , Auckland Wellington Canterbury Rest of New Zealand Source: Statistics New Zealand, Colliers International Number of Building Consents Industrial Research & Forecast Report Second Half

28 Submarkets Auckland Our latest August 2018 industrial survey findings indicate a record low vacancy rate of 1.7 percent overall. This is the lowest vacancy rate recorded since our surveys began in August The overall reduction is attributed to secondary vacancy falling, which fell 0.2 percent from last year June. Prime average vacancy has remained steady at 1.3 percent between the February 2018 and August 2018 surveys, albeit there was a slight increase from 1.2 percent a year ago. Warehouse rental growth shows no sign of slowing down at least in the short-term, primarily due to the lack of supply and the sharp reduction in secondary vacancy, limiting tenant options. Prime average net warehouse rents continue to track upwards, reaching $124 per sqm in June 2018, a 4.4 percent increase from a year ago. Secondary average net warehouse rents are following accordingly resulting in $105 per sqm, a 6.4 percent increase from a year ago. Looking at transaction activity, in September, Foodstuffs 13.12ha distribution centre in Mt Roskill, Auckland sold for $93 million. This represents the largest singular asset industrial transaction on record in New Zealand. The previous record-holder was the $90 million sale of The Warehouse distribution centre in Both properties were sold by Colliers International. The latest Colliers International Auckland industrial investor confidence survey result shows that investor confidence for the September 2018 quarter was the strongest of all sectors with a net positive 58% (optimists minus pessimists). Wellington The Wellington industrial market continues to perform strongly, driven by strong tenant demand, a lack of available industrial supply, and growth from local industries. Vacancy has dropped to 2.1 percent in November 2017, down from 2.9 percent a year ago. Vacant industrial space has almost halved in Petone / Alicetown from 4.6 percent in November 2016, down to 2.4 percent in November Prime average warehouse rents climbed to $108 per sqm in June 2018 from $100 per sqm a year ago. Average prime yields have firmed 17 basis points relative to a year ago, reaching an average 7.52 percent. Average secondary yields have reacted in similar fashion tightening 19 basis points to an average 8.71 percent in June Evidently, Oyster Property Groups $12.81 million acquisition of a mixed used warehouse on Hurring Place, had a passing yield of 6.93 percent. The sale indicates a weighted average lease term of 4.95 years. The latest Colliers International Wellington industrial investor confidence survey result shows that investor confidence for the September 2018 quarter was at a net positive 41% (optimists minus pessimists). While this is down slightly from the previous June 2018 quarterly result of a net positive 46%, it remains the second most confident period in the survey s history which began in late Kordel Place, East Tamaki, Auckland Sold on behalf of MC Thompson Family Trust for $27.5m 11 Springs Road, East Tamaki, Auckland Leased on behalf of Stride Property Limited for a lease term of 25 years 28

29 Christchurch Outlook Average prime and secondary warehouse rents have remained steady over the last year at $103 per sqm and $77 per sqm, respectively. We forecast each of the main centres to remain in growth mode over the next months, but at differing speeds and in different sectors of the market. Annual building consent numbers have declined ever so slightly from 179 in 2017 to 161 in This is also reflected in the annual value of new building consents in the Canterbury region which declined 39 percent from $316 million in 2017 to $194 million in However, the annual value of new building consents in 2017 was a historical high, therefore the reduction in 2018 most likely indicates the region is slowly returning to more typical market levels. In Auckland, the persistence in occupier demand which has kept vacancy rates at record lows is unlikely to be met by a sufficient supply response. Land availability and pricing remains the key market mechanism that will result in demand outweighing supply. Greater levels of cashflow will likely be sought with yields at record lows. Prime average yields have firmed for the first time since December 2016, tightening to 6.55 percent in June 2018, a drop of 28 bps for the same time last year. Secondary average yields have moved in the same accord, dropping 15 bps to 8.25 percent in June Notably, in June, Steel & Tube sold their property on Blenheim road for $21.1 million on a sale and lease back basis. The latest Colliers International Investor confidence survey shows sentiment is building in the Christchurch industrial sector, with the net positive 16% result the highest recorded in 18 months. This indicates investors are taking a more positive view of the current demand and supply balance in the sector as well as pricing. Wellington s buoyant industrial market continues to gather pace with a construction pipeline that hasn t matched occupier demand. Transmission Gully, along with other infrastructure projects like the Whitby and Waitanagirua link roads by Porirua City Council, will create better and more efficient transport options for new areas of development. Timeframes for the Petone to Grenada (P2G) Link road have been extended due to the Government Policy Statement (GPS) 2018 review. In Christchurch, the release of significant industrial land across Christchurch post the earthquake has seen occupiers with a significant number of options to pursue. While supply and construction activity has been strong, the market is now reaching a period of stability. This should assist with cashflow and investment returns over the medium term Roma Road, Mt Roskill, Auckland Sold on behalf of Foodstuffs North Island Limited for $93m Industrial Research & Forecast Report Second Half

30 OUR EXPERIENCE INDUSTRIAL SOLD 4 Kordel Place, East Tamaki, Auckland Sold on behalf of MC Thompson Family Trust for 27.5m 100 Hoepner Road, Bundamba QLD Sold on behalf of a private client for 12.5m Southern Road, Mentone, VIC Sold on behalf of a private client LEASED 11 Springs Road, East Tamaki, Auckland Leased on behalf of MC Thompson Family Trust for 27.5m 9-19 Culverston Rd Minto, NSW (3 deals) 172,895m² (total) On behalf of Private Client 1 Radar Street Lytton, QLD 15,980m² On behalf of Port of Brisbane (Lessor) Steelforce Australia (Occupier) MANAGED LOGOS Porfolio (55 Assets) NATIONAL 1,000,000m² On behalf of LOGOS Property, Australia 3 Roberts Road, Eastern Creek, NSW 55,000m² On Behalf of Mappletree Link Drive Distribution Centre, Braeside, VIC 10,416m² On behalf of Cache Logistics Trust VALUED Portfolio of 13 major Victorian institutional industrial assets within Keysborough, Dandenong South, Tullamarine, Derrimut and Truganina On behalf of Fraser Logistics & Industrial Trust Dexus Industrial Estate Pound Road West, Dandenong South On behalf of Dexus Property Group Oakdale South Industrial Estate, Otellia Road, Kemps Creek NSW Total Site area of 376,968m² On behalf of Goodman Industrial Funds Management Limited PROJECT MANAGED AND/OR TENANT ADVISORY Giraween, NSW On behalf of Caleven Pty Ltd Truganina, VIC On behalf of Isuzu Australia Clayton, VIC On behalf of BlueScope Steel Accelerating success. How else can we help you? Speak to one of our property experts today. au.industrial@colliers.com

31 AUSTRALIA & NEW ZEALAND IN THE LAST 18 MONTHS $3.4 billion of industrial assets 15 Ashby Close, Forrestfield, WA Sold on behalf of Perdamon Group for 20.5m Percival Road, Smitfield Sold on behalf of GM Property Group for 44.8m 54 Crittenden Road, Findon, SA Sold on behalf of a private client for 1.65m more than 800 transactions covering 2,690,000 square metres 89 Cavan Road Gepps Cross, SA Land 10,466 m² Building 3,830 m² On behalf of M&G Holdings Pty Ltd 23 Hollinsworth Road Marsden Park, NSW 12,525m² On behalf of Logos Empire Industrial Estate - Lots 62 & 63 Peachey Road Yatala, QLD 9,170m² On behalf of CIP (Lessor) ATCO Structures & Logistics (Lessee) 536 assets totalling over 4,900,000 square metres Carl Zeiss Australia Building, Clovely Park, SA 3,950m² On behalf of Private Client 1979 Ipswich Road, Rocklea, QLD 25,293m² On behalf of ZUPP Property Group Campbellfield Distribution Centre, Campbellfield, VIC 22,608m² On behalf of Cache Logistics Trust valued over 278 assets with a value in excess of $9.29 billion Hoxton Distribution Centre, Cowpasture Road, Hoxton Park, NSW Total Site area of 305,900m² On behalf of Mirvac Funds Limited Arcadia Industrial Estate 636 Boundary Road, Coopers Plains, QLD Total Site area of 35,258m² On behalf of Goodman 4 Beach Street, Eastern Creek, NSW Total Site area of 18,921 m² On behalf of Lendlease Real Estate Investments Limited Projects delivered by our award winning team Occupier Services team Archerfield, QLD Hi-Trans Express Alexandria, NSW On behalf of NID Welshpool, VIC On behalf of AB Mauri For more information about Colliers International and working with us visit: