Brisbane market
Occupier demand has moderated in the Brisbane industrial market as cost-of-living pressures place downward pressure on consumer demand. Over the past 12 months, a total of 714,400 sqm of gross take-up was recorded – a 27.6% decrease over the previous 12 month period from Q3 2023 to Q2 2024. In line with this slowing of occupier demand, supply delivery is slowing. Over the next 12 months, only 232,000 sqm is currently under construction and expected to reach practical completion. While it’s expected that more projects will move to construction phase over the next few months, which is improve completion estimates, it is unlikely that the supply total will exceed the long-term, 10-tear average of 376,300 sqm recorded between 2015-2024.
Despite a slowing occupier demand environment, investment activity has been comparatively strong. Strong economic fundamentals of high population growth and positive economic output has resulted increase investor appetite for industrial assets and land in Brisbane. Over the past 12 months, AUD 1.70 billion of industrial transactions have been recorded – almost double the sales total recorded over the previous 12-month period from Q3 2023 to Q2 2024.
It’s expected that Tenants will likely remain cautious throughout the rest of 2025 until there is further clarity regarding market conditions. JLL Research anticipates for demand to pick up towards the end of this year and into 2026. Lower borrowing costs and improved confidence could assist retail and wholesale businesses, potentially increasing leasing activity in the near future. Speculative supply is expected to be low over the balance of 2025 and into 2026 as developers move down the risk curve and preference income security through pre-lease agreements. Solid capital market activity and investor demand are increasing bidder competition for existing assets. In the medium-term, the upcoming Brisbane Olympic Games in 2032 may attract additional prospective buyers.