Brisbane Southside Blog

By Joseph Grasso, Principal of Raine & Horne Commercial Brisbane Southside & Bayside

The end of 2019 saw a flurry of activity as the year ended with many looking to secure their next property move prior to Christmas.  With 2020 now well and truly in full swing we wanted to provide you with our thoughts and predictions for the year ahead in the Commercial and Industrial Property Market.

With the continuation of the current low interest rate environment we expect to see demand outweigh the supply on the market for properties for sale from both an investor and owner occupier perspective.  During the latter part of 2019 we saw sale stock continue to decrease and witnessed competitive bidding at our most recent auctions which sold under the hammer.  These properties were (click links to view):

11 Vanessa Blvd, Springwood
4 Webb Street, Bundamba
75-79 Randolph Street, Rocklea

For investors looking to secure their next property we may see yields continue to tighten slightly into the 6.25% – 6.75% range for quality buildings with long term tenants.  Properties considered to be in the B Grade category may see better returns in the 7% – 8% bracket.

Investors who are happy to consider a more aggressive property acquisition will benefit from greater returns if their risk profile is broadened.  

What do we mean?

If you are in a position to purchase a vacant property or a building with only a short-term lease with a view to potentially reposition the property by way of reconfiguration or refurbishment, we predict this is where investors may find more value.  In addition, those investors who can offer competitive incentives for the right tenants may reap the rewards of longer-term tenures whilst maintaining a strong market rental return.

For Owner Occupiers, building functionality is always a key element when looking to purchase a property.  With limited sale stock on the market owner occupiers will also be competing with Investors in many cases.  An alternative, is to consider purchasing land and developing a building that suits your business needs.  Land is limited in the traditional southside industrial hubs, but excellent opportunities exist in the estate at Waratah Industry Park in Acacia Ridge and Metroplex Westgate in Wacol.  These estates offer land options from 1,800sqm.

If your business model includes leasing commercial property we may see a potential take up of more leasing stock in certain size ranges as it becomes more difficult to find the right property to buy.  In addition we have seen many businesses requirements change over the past 6 months in both directions – downsizing and upsizing.

For users in the larger sector of the leasing market (from 2,500sqm) design & construct opportunities now exist in the heartland of Brisbane’s Southside with the Archerfield Airport about to commence civil works for the Transition Logistics Estate.  Click here for more information.

In summary, we predict 2020 will be an active year in many areas of the market. Opportunities will arise and those who are ready to act at the right time will find the right property for them.  For those considering selling or leasing their property, be sure to speak with our team on the best way to maximise your result in the shortest possible time frame.

All the best for a prosperous 2020!