Rise of multi-storey warehousing

We are pleased to share an update of our Australia Multi-Storey report. The report provides industry leading insights on key drivers of multi-storey developments and the current pipeline of projects in the Sydney market.
 
Key Points:

• Multi-storey warehouses have historically been developed within the densely populated areas of Asia. We expect to see at least 6 multi-storey facilities built in Sydney over the next two years.
• Key drivers of multi-storey warehouse development include; limited industrial land and high land values in prime locations, greater demand from e-commerce related occupiers and associated occupier/consumer needs from delivery time and cost.
• Leasing transactions (by floorspace) from retail related occupiers in 2022 was concentrated in the Sydney market.
• Tight supply conditions are unlikely to ease due to land constraints. Multi-storey warehousing is one way to increase new floorspace available in the market.
• Land constraints is a particular issue within Sydney’s Inner precincts, where these areas are becoming increasingly sough after as ‘last mile’ distribution hubs for e-commerce.
• South Sydney is well positioned to accommodate multi-storey warehouses, and the current development pipeline of committed projects is concentrated within this market.
• Approximately 15% of total new floorspace expected to be delivered in Sydney over 2023 to 2027 will be attributed by multi-storey developments.
• A notable development project is Charter Hall’s multi-storey facility in Alexandria, South Sydney (Ascent on Bourke), which is currently almost 100% pre-committed and due to complete in 3Q24.