Adelaide Industrial Market Dynamics Q2 2026

• Uptick in owner-occupier activity over Q2 2026.
• Supply delivered to market escalated over the quarter.
• Strongest quarterly rental growth recorded in the Outer South.

Occupier demand in Adelaide increased significantly over the quarter, with gross take-up totalling 128,100 sq.m. This figure is also above the average quarterly gross take-up of 94,500 sq.m., recorded over the past two years. 16 major occupier moves (>3,000 sq.m.) were recorded over Q2 2026, with owner-occupiers accounting for 46.2% of space leased. The largest deal was a 24,000 sq.m. design and construction development for Safcol Australia at 2-32 Essington Drive, Edinburgh (Outer North).

New supply delivered increased in Q2 2026, totalling 88,000 sq.m. Currently, there are 12 major developments under construction totalling 104,000 sq.m., with the pre-commitment rate currently at 47.7%. Additionally, there are eight projects with plans approved in the future supply pipeline, totalling 91,200 sq.m and two projects with plans submitted, totalling 8,200 sq.m.

Average prime net face rents increased across two precincts in Q2 2026, with 3.9% recorded in the Outer North and 4.7% in the Outer South precinct. The rise in asking rents is a result of the continuing trend with occupier demand outpacing supply. Average land values for 2,000 sq.m. lots increased across all precincts in Q2 2026, while land values for the Outer North precinct (1 Ha) were unchanged. On an annual basis, average land values (2,000 sq.m.) increased between 5.3% and 12.5%.

In the near-term, market conditions are expected to be underpinned by sustained tenant demand and limited new supply, which are likely to support further tightening in vacancy rates and continued rental growth, albeit at a more moderate pace than recent years. Prime grade space is anticipated to experience stronger leasing activity, driven by tenant preference for high-quality assets. However, as prime CBD stock tightens further, a continuation of spillover demand is expected into higher quality B-grade stock. 

Numerous assets are expected to trade over the latter half of the year and support strong investment volumes. The yield compression cycle has now been pushed back further to 2028.