Rent rates are strengthening and yields are reducing as demand puts the squeeze on stock in Queensland’s North Moreton region, new research from Ray White Commercial shows.
Development in North Lakes and demand from local business are leading to limited quality vacancy in the region north of Brisbane. Total vacancy for the region is now just over 50,000sqm, according to the Between the Lines North Moreton Industrial Overview October 2017 report.
“This is an impressive result and testament to the strength of this local demand,” Ray White Commercial Head of Research Vanessa Rader says.
North Lakes has yielded strong demand since its introduction into this location and highlighted tenants’ appetite for quality, modern facilities at a higher cost.
“While built stock remains quite tight in North Lakes, a steady stream of approved developments and under-construction mixed-use complexes will ensure this remains one of the more active precincts in the coming 12 months,” Ms Rader says.
The continuing stock squeeze in the North Moreton industrial market has meant properties that have been standing vacant are now being snapped up, Mr Massie says.
In Caboolture, 9 Auster Court — a low 800sqm tin shed on an irregular shaped 2862sqm lot — has recently been leased after being vacant for almost 18 months.
“This was the last standalone property available out of over 340 tenancies on the estate.” Mr Massie says.
“The site has been leased by Rudd’s Panel Works, which is able to use the additional yard space without being impacted by the restricted clearance.”
A low site coverage 638sqm tilt panel building at 101 Kabi Circuit — one of the last remaining standalone properties in Deception Bay’s Baylink Estate — was sold by Mr Massie and Ray White Commercial North Coast Central colleague Ashley Rees for $1.5 million to a locally based line marking and traffic company, Dingo Road Services, which had outgrown its 378sqm strata unit in nearby Imboon Street.
“This sale is indicative of the continuing stock squeeze, where even properties with specific function or long-term vacancy history are being sold to businesses trying to keep pace with their expansion requirements,” Mr Rees says.
A vacancy count by Ray White Commercial across the region in August found the Caboolture area known as Corporate Park, pictured above, to be one of the best performers with a low 19 vacancies.
“Since this count, further absorption has occurred and the current 15 vacancies totalling 7699sqm represents an overall estate occupancy level of 95.7 per cent,” Ms Rader says.
This has been a key driver for a number of off-market investment transactions in recent months and is creating strong pre-commitment interest for the upcoming Corporate Park East estate launch.
Mr Massie says the Ray White Caboolture North Coast Central team is now dealing with the normal pre-Christmas tenancy rush of businesses looking to transition over the break.
“This means we will come into the new year with even lower stock levels across all size ranges,” he says.
“The positive is that rents are pushing back up to where development becomes feasible, and land enquiry for the new Corporate Park East estate reflects this.”