Australia’s national industrial & logistics vacancy rate lifts to 3.2%

Australia’s average industrial & logistics vacancy rate continued its steady climb in the second half of 2025 to 3.2% but remains one of the lowest rates globally.

CBRE’s Industrial & Logistics Vacancy Second Half 2025 Report shows the vacancy rate lifted for all states except Brisbane.

The vacancy rate for Sydney sits at 2.9%, Melbourne sits at 4.7%, Brisbane is 3.2%, while Perth and Adelaide both have a rate of 1.8%.

CBRE’s Head of Industrial & Logistics and Data Centre Research Australia, Sass Jalili noted that while the vacancy rate continued its upward trajectory, it remains below the 3.5% forecast for this period.

“Vacancy is still expected to peak in the second half of 2026, however, even at its highest point the rate is expected to remain below the market’s ‘equilibrium’ threshold of 4%,” Ms Jalili said.

The report found that nationally the risk of sublease space has now largely subsided and is no longer viewed as a threat to future supply

Looking ahead, Ms Jalili noted the decline of super prime availability alongside a lift in vacancy within prime and secondary assets was an emerging trend for 2026.

“The superior height clearance and efficiency of super prime facilities are increasingly critical for logistics operators, Australia’s largest industrial occupier segment, which is supporting the sustained demand for these spaces,” Ms Jalili said.

“In the long-run, Australia's supply of serviced, zoned industrial land is expected to remain structurally constrained, limiting new development pipelines. This scarcity, combined with the ongoing expansion of e-commerce and food & beverage occupiers, as well as sustained population growth, will remain key drivers of long-term growth,” Ms Jalili added.

Michael O’Neill, Regional Director Pacific Industrial & Logistics and Managing Director of Western Sydney said, “H1 2025 commenced with a notable uplift in occupier enquiry compared with 2024; however, this did not consistently translate into relocations. For most occupiers, the requirement for additional space was frequently outweighed by the cost, operational disruption and execution risk associated with relocating. As a result, demand has remained selective, with occupiers prioritising efficiency gains over expansion.

“Transactional activity lifted incrementally in Q2 across most markets, although renewals continued to dominate, accounting for more than 85% of leasing activity in many locations. Where transactions have occurred, they have largely been driven by landlords prepared to offer more competitive commercial terms, including enhanced incentives, early access, and increased fit-out contributions.

“This dynamic is expected to persist into 2026 as owners increasingly acknowledge that depth of demand is more consistent with a ‘normalised’ market environment. Secondary-grade assets, in particular, are expected to remain under pressure, with incentives pushing beyond long-term averages as they compete with newer, more efficient stock,” Mr O’Neill added.

Sydney

Sydney's vacancy rate is 2.9%.

CBRE’s Head of Western Sydney Industrial & Logistics Tom Rourke noted large-format sub-lease space has been a key driver shaping headline vacancy metrics over the past 12 months.

“Leasing volumes for 2025 were concentrated across Western Sydney. Aldi’s 87,000sqm pre-lease, and pre-commitments from Jennmar, 33,000sqm, and Refresco, 25,000sqm, underscoring sustained demand for prime or emerging logistics hubs. Most leasing activity continued to focus on 3,000–10,000sqm facilities; however, the availability of new speculative developments has broadened tenant choice and led to an uplift in incentives,” Mr Rourke said.

“Super Prime face rents were largely stable throughout 2025, reflecting more cautious occupier expansion plans. Notably, renewed activity from the 3PL sector in Q4 – now accounting for close to 50% of leasing volumes – has begun to re-energise the market,” he added.

Melbourne

Melbourne’s vacancy rate is 4.7%.

CBRE State Director Thomas Murphy noted vacancy across Melbourne’s industrial market continued its upward trajectory through 2025, driven by a sustained imbalance between elevated supply levels and subdued occupier demand.

“While face rents have largely held firm, incentives have edged higher across all precincts, reflecting the competitive leasing environment. Sublease availability remains limited across most precincts, with only the West continuing to offer a moderate amount of sublease options,” Mr Murphy said.

“Looking ahead, the anticipated slowdown in supply completions from 2026 is expected to provide some relief to upward vacancy pressures. Despite current cyclical headwinds, super-prime assets in core locations are expected to outperform in the current environment,” he added.

Brisbane

Brisbane’s vacancy rate is 3.2%.

CBRE State Director Matthew Frazer-Ryan said, “Leasing demand and transaction volumes continued to improve throughout 2H25 with occupiers seeking both functional and cost-effective solutions for their businesses.

“Whilst significant transactions were finalised, particularly across the Southern industrial precincts, the Greater Brisbane vacancy profile as an average remained relatively stable with only a minor contraction to 3.1%. Occupier demand and enquiry have also increased over the later part of the year, and we expect this to create a stronger and more robust leasing market into 2026,” he added.

Perth

Perth’s vacancy rate is 1.8%.

CBRE Senior Director Jarrad Grierson said, “The increased vacancy comprises a mix of some new supply, prelease backfill space and sublease accommodation. Tenant enquiry remains fairly subdued as tenants adjust to increased rents and broader economic uncertainty. Market rent growth has stabilised with recent deals indicating an increase in leasing incentives as landlords become more motivated.”

Adelaide

Adelaide’s vacancy rate is 1.8%.

CBRE State Director Paul McKay said, “Although remaining at historically low levels, Adelaide’s vacancy rate has increased to 1.8%, reflecting an easing in occupier demand, particularly at the larger end of the market.

“A slight increase in sublease activity has also been observed. On a more positive note, early-stage enquiry from suppliers and businesses related to the AUKUS submarine project has been observed, following similar trends observed in the office sector. This take up driver is expected to grow dramatically as the project moves forward,” he added.