Colliers report gives valuable insight into the local market
Regions to be brought into the spotlight As the economy changes at a rapid pace, businesses are challenged to adapt quickly to changing market conditions to stay competitive, and afloat.
While the COVID-19 pandemic is first and foremost a major public health concern, it has quickly become a significant economic issue and it’s having deep ramifications for financial systems not only in Australia but around the globe.
As we adjust to the new ‘normal’, the pandemic also presents opportunities for certain industrial and logistics markets and sectors as demand is shaken up and businesses look to do things differently.
The ever-growing desire for more efficient logistics platforms is expected to drive industrial occupiers to seek warehouse space outside of the major capital cities.
Modern technology and changing consumer habits will assist with this trend as the way we make, buy and distribute goods changes significantly over the next decade.
De-centralising and relocating to a regional location can enable warehouse functions to be better integrated with key road and rail infrastructure and away from the congestion associated with capital cities.
As a result, demand for industrial space in key regional centres has grown over the past five years, led by affordability, infrastructure and access to a growing population base.
In addition, major regional centres will tend to offer lower occupancy costs, opportunity for expansion and access to a ready and skilled workforce.
In many cases, population growth rates in major regional centres located within an hour or two of major capital cities has outstripped growth of the capital cities.
The COVID-19 pandemic is likely to lead to a rethink of supply chains and the reliance on significant offshore production for some industries.
Major regional centres are poised to capitalise on these market changes.
Historically, manufacturing has been an important contributor to major regional economies in recent decades and stems from industries including food, construction, vehicle and machinery and materials and resources.
While not all occupiers will seek more affordable leasing options outside of our capital cities, growth in ‘ hub and spoke’ facilities near urban locations could be expected.
This would enable occupiers to reduce their physical footprint in more expensive capital city markets while having a larger facility in a more affordable major regional location to service the market.
Going forward, the $10 billion Inland Rail project will challenge the status quo of the industrial market on the Australian East Coast, expanding and connecting the supply chains across Melbourne and Brisbane to international and other domestic markets.
This initiative, scheduled for completion by 2028, will strategically lift the national freight capacity creating distribution and transport efficiencies.
Prompted by a significant investment in major infrastructure projects, the Toowoomba industrial market has performed well in recent years with a steady flow of leasing and investment demand being recorded.
Positioned approximately 125 km from Brisbane, Toowoomba is Australia’s second largest inland city with a population of almost 140,000 persons and an economy size of $12.2 billion.
In recent years, the economy has experienced a period of significant growth and change with its economy growing by 21% over the past five years.
Recent growth has stemmed from major investments in local infrastructure which has improved productivity, accessibility and amenity.
Looking ahead, there is over $13 billion in infrastructure works in the pipeline which will bolster demand for industrial space across Toowoomba.
A bright future underpinned by infrastructure
As a long-established service centre for the broader South West Queensland and North West New South Wales region, Toowoomba has developed specialisations and strengths based on its strategic location and access to resources, both of which continue to influence the local industrial market.
Toowoomba plays a pivotal role as a key freight and logistics centre and the construction of the Brisbane to Melbourne Inland Rail Link will be a game changer for the local industrial and logistics market. Other major developments include the Toowoomba Trade Gateway (formerly Toowoomba Enterprise Hub) which incorporates FKG Group’s AATLIS and InterLinkSQ developments and Wagners’ Toowoomba Wellcamp Airport and Wellcamp Business Park.
Still time to get tickets to luncheon event
Join Colliers International for a business luncheon to learn more about the current property market with guest speaker Michael Matusik.
He will be analysing the Toowoomba property market for 2020 as well as major trends shaping urban development and will give an insight into housing opportunities over the next 10 years.
There will also be an opportunity to engage with key industry leaders on the property panel to discuss their thoughts and ideas on the current Toowoomba market. Panel members include: Michael Matusik, Dan Dwan, Denis Wagner, Andrew Bullen, Stephen Bowers, Terry Kehoe and Stewart Somers.
The event will be held on Friday, October 16 at the Oaks Hotel with a two-course gourmet lunch and 3-hour drinks package included in the $95 ticket price.