The industrial property market in Adelaide is currently facing a critical challenge: there’s just not enough land available. This scarcity is causing land rates and rents to skyrocket, which is putting pressure on both tenants and prospective property investors. On top of that, the recently announced Torrens to Darlington project is expected to affect the current accommodations of many business owners, making the situation even more urgent.
The Torrens to Darlington project is a significant infrastructure project, aimed at improving transport and reducing congestion in the region. The project involves upgrading and widening the existing Southern Expressway, which connects the southern suburbs of Adelaide with the city centre.
“One of the main problems affecting the Adelaide industrial property market is the shortage of available industrial land. This is coupled with a historically low vacancy of industrial leasing stock that is anecdotally less than 2.0% in Adelaide and very similar nationally. As demand keeps growing, there’s not enough supply to keep up, and this is causing land rates and rents to go up. This not only hurts businesses financially but also hinders the overall growth and development of the industrial, logistics and manufacturing business sector in Adelaide.” said Broadway Property’s Director, Ryan Stewart.
To make matters worse for tenants and property owners, recent compulsory acquisition and relocation notices have been sent to a number of businesses along South Road. The Torrens to Darlington project will mean an increase in businesses that will be forced to relocate their operations in an industrial market that is suffering from a shortage of land as well as a shortage of available leasing stock, so it’s important to start looking for alternative spaces as soon as possible. Taking proactive measures and being flexible will ensure that affected businesses can continue to operate after their properties are acquired.
To reduce the risks associated with the undersupply and competition, tenants and property owners need to approach the search for alternative industrial properties with flexibility. Flexibility expands the range of options and enables tenants and property owners to discover properties that may have initially been overlooked. By adapting preferences, exploring different locations, considering alternative rental strategies, and being open to property improvements, individuals can enhance their chances of finding suitable accommodations in a challenging market.
“Given how complex and challenging it is to navigate the Adelaide industrial market right now, it’s crucial for tenants and property owners to seek independent advice when seeking alternative premises and discussing their individual situations. Consulting with professionals who specialise in lease negotiations, property acquisition, and development can provide valuable insights and guidance throughout the process. Getting expert advice helps you make informed decisions and increases the likelihood of achieving a better outcome,” said Ryan.
For a confidential discussion about your current industrial property requirement, speak to one of our consultants at Broadway today: https://broadwayproperty.com.au/contact/