The industrial property market has reached its bottom and is currently on the way up according to Jones Lang La Salle.
According to figures released yesterday the commercial real estate agent, more than $312 million of industrial properties worth more than $5 million were sold during the July quarter, up from $239.1 million in the previous quarter.
La Salle’s head of industrial property for NSW, Matthew Herrett, said yields had bottomed out thanks to a pick-up in transactions and an improvement in economic confidence.
“I think the bottom has been and gone. I think February was probably the bottom,” he said.
“Owner occupiers have started to raise their heads again and I think this is on the back of better economic news.”
Mr Herrett said expectations of a further blow out in industrial property yields are likely to be overstated.
CB Richard Ellis regional director Joshua Charles agreed that the worst was over for industrial property prices.
Speaking to fund managers at a presentation in Sydney yesterday, Mr Charles said yields on prime industrial assets with good leases have firmed to now sit between 8 per cent and 8.4 per cent.