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Shortage of move-in ready facilities defines Adelaide’s industrial market

By Kyle Robbins
19 October 2023 | 11 minute read
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Commercial facilities that are immediately ready for tenants are few and far between in South Australia’s capital.

According to Knight Frank agent David Ludlow, a shortage of ready industrial properties means “demand remains strong across the transport, warehousing and wholesale trade sectors”.

New data from Colliers showed enquiry levels across the city’s industrial sector remained robust throughout the second quarter of the year, due in large part to the recent performances of the transport and logistics sector.

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Even with the city experiencing new stock additions totalling the long-term average in terms of square metre per quarter, rental growth across commercial assets in the city remained strong. Prime rents increased 2.5 per cent throughout Q2, as part of a wider 16.5 per cent annual increase, with prime space rents now averaging around $128 per square metre.

With the remainder of the year only expecting a modest level of supply, Adelaide’s commercial environment appears conducive to increasing rents.

Leveraging off the back of these market conditions will be move-in ready facilities, with some such a 5,881-square-metre site in Green Fields expected to generate strong buyer interest.

The property, taken to market by Mr Ludlow and fellow agent Marco Onorato, has the potential for multiple uses including industrial, logistical, warehousing, storage, research and training land use.

Mr Onorato described the property, which lies within the City of Salisbury, as a “rare sealed site boasting expansive frontage to Greenfields Drive providing dual heavy vehicle drive around access and hardstand area”.

Within close proximity to established brands, such as the Coates Hire, he explained the property was “previously occupied by a logistics user” who benefitted from its “connectivity to major road infrastructure, including Port Wakefield Road – National Highway A1, Salisbury Highway and the North-South Motorway.”

The property offers 1,398 square metres of valuable office, warehouse and workshop space, over three main buildings on an expansive 5,881-square-metre site.

Data released in August by Knight Frank put accelerating rental growth within the South Australian capital’s industrial sector down to the market playing “catch up”.

According to the report, over the second quarter of the year no Australian commercial market recorded rental growth higher than Adelaide’s 5 per cent.

Moreover, a new motorway and multipart upgrade project currently underway is expected to impact the city’s commercial scene, with greater connection between north and south Adelaide which could increase foot traffic around businesses along the route.

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