Australia’s online sales share climbs back to Pandemic peak

Australia’s online retail sales are in a growth phase, with the e-commerce penetration rate rising back to an all-time high rate of 14.3% and is forecast to be 17% by 2029.

CBRE’s latest report on Australia’s E-commerce and its Impact on Logistics Real Estate forecasts over the next five years 1.7 to 1.8 million sqm of additional e‑commerce-dedicated logistics space will be required to support the growth of online sales.

The report also highlights the 2025-2027 forecast supply pipeline is insufficient to meet the needs of e-commerce, the food and beverage sector, and population growth.

CBRE’s Head of Industrial & Logistics, Data Centre Research Australia Sass Jalili noted with logistics demand expected to continue outpacing supply, it’s estimated net effective rents will grow nationally by an average of 4.1% per annum over the next four years.

“There are several factors supporting e-commerce growth in Australia. A greater number of tech-savvy Australian households – including millennials and Gen Z through to older consumers - are shopping online and with greater frequency. Improved digital payment options have prioritised convenience and accessibility while enhanced delivery networks have resulted in faster shipping,” Ms Jalili said.

The size of Australia’s retail market totalled close to A$440 billion in 2024 and retail occupiers made up around 20% of the total logistics floorspace leased in 2024.

Ms Jalili noted e-commerce supply chain operators typically require three times more warehouse and logistics space than a traditional brick-and-mortar supply chain.

“As e-commerce continues to grow, competition among distributors and retailers for modern, high-quality logistics space in Australia will intensify. CBRE’s analysis suggests that for every A$1 billion of e-commerce sales an additional 70,000 sqm of logistics space is required. Based on this, we see a further 1.7 to 1.8 million sqm of logistics space will be needed for e-commerce between now and 2030, which combined with other major growth drivers, exceeds the current supply pipeline,” Ms Jalili added.

Australia’s logistics availability has tightened since the pandemic with most Australian markets reporting a vacancy rate of less than 3% between 2021 and 2025YTD.

“Australia will see a decrease in logistics supply from 2025 to 2027F, with new completions expected to average 1.9 million sqm per year. This will be below the annual average of 2.1 million sqm of structural demand CBRE estimates is required by the e-commerce sector, population growth, and the food & beverage sector,” Ms Jalili added.