28/05/2008 - 22:00

Industrial land strong

28/05/2008 - 22:00

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Industrial land strong

Perth has the strongest industrial land market in the country, with rents surging 37.3 per cent in the March quarter, according to a report from CB Richard Ellis.

In the year to March, prime industrial rents reached $119 per square metre (net face).

This put Perth narrowly behind Sydney, where rents grew by just 2.4 per cent to $123/sqm.

In the same period, Brisbane rents were up 1.7 per cent, while Melbourne and Adelaide posted increases of less than 1 per cent.

Growth in land values was also highest in Perth, in both the 0.25 hectare and 1.6ha lot categories.

Prices for quarter hectare lots rose by 63.2 per cent in the year to March, while the value of 1.6ha parcels increased by 48.4 per cent.

CB Richard Ellis regional director, industrial and logistics services, Michael Fenton, said in a statement that Perth was expected to continue to perform above other industrial markets nationally, although the rate of rental growth was likely to slow in future years.

"Perth is forecast to experience lower economic growth than the strong levels achieved over the past few years," he said.

"This will lead to some easing in rental growth, although we still expect the Perth market to perform strongly given the limited availability of zoned land and continued demand from the resources sector."

Mr Fenton said new infrastructure projects, such as the proposed Tonkin Highway extension, were also likely to provide a boost to demand in nearby areas.

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