Population Growth and Strong Occupier Demand Set to Drive Ongoing Industrial Land Supply Issues in Brisbane

Brisbane will require close to 1.2 million square metres of new industrial floorspace over the next five years just to keep pace with population growth, a new CBRE report has shown.

This will put increasing pressure on Brisbane’s limited supply of serviced, undeveloped industrial land, which has been shrinking over the past decade.

CBRE’s new Brisbane Industrial & Logistics Land Supply report highlights that only 5% (653ha) of the total zoned industrial land in the Brisbane region is undeveloped and serviced.

CBRE Research Analyst Charlotte Fordyce said strong ongoing demand from transport & logistics, manufacturing, and retail occupiers, coupled with Brisbane’s projected population growth of c.260,000 people by 2030, would further exacerbate land supply issues.

“The lack of available zoned land is particularly evident in the North, South and Australia TradeCoast precincts – areas that are becoming ever more sought after as last mile hubs,” Ms Fordyce said.

“This is continuing to drive significant appreciation in land values, with the average value of large lots having doubled over the past three years.”

CBRE’s Queensland Industrial & Logistics Director Matthew Frazer-Ryan said Brisbane’s sought after TradeCoast precinct had the lowest availability of undeveloped serviced land, with sites tightly held by a small group of institutions and private owners.

“Due to the limited land supply in the TradeCoast we expect to see a new trend emerge, as owners seek to maximise the value of existing sites by replacing outdated and obsolete buildings with modern, state-of-the-art facilities that cater for evolving occupier demand and built form requirements,” Mr Frazer-Ryan said.

“As land supply in this precinct continues to decline it will increase the consideration of multi-storey warehousing for core near City and last mile requirements, which is currently only prevalent in the Sydney market.”

Other report highlights include:

• The Western Corridor and M1 Corridor have the largest share of undeveloped serviced land supply (~27% each), equating to 178 ha and 177 ha, respectively, while The Trade Coast North (11%) and Trade Coast South (11%) precincts have the lowest share.

• The amount of new industrial floorspace in Brisbane has been higher than average for three consecutive years. However, new floorspace has been readily absorbed, with Brisbane’s industrial vacancy rate remaining below 3%.

• Moderate new supply is forecast over the next four years, averaging circa 294,000sqm per annum, compared to the 10-year average of circa 386,000sqm. Brisbane’s lack of available zoned land will continue to contribute to a decline in the development pipeline, driving elevated rent growth.

• While industrial rents in Brisbane are already at record levels, the city continues to attract national occupiers who have been priced out of the Sydney market. In 2014, average prime rents in Sydney were 7% higher than the Brisbane average, however this gap was 39% higher as at Q4 2024.