Industrial properties, primarily used for manufacturing, storage, and distribution, encompass a range of facilities, including factories, warehouses, distribution centers, workshops, and storage units. With sizes ranging from small workshops of around 50m² to large-scale facilities exceeding 10,000m², industrial properties are strategically designed for accessibility, often including an office component and well-connected to major transport routes.

From an investment standpoint, industrial properties are generally more affordable on a per-square-meter basis compared to other commercial assets, with lower outgoings such as land rates, council fees, water, and strata costs. These properties are also low-maintenance, making them attractive for investors. Leases for industrial spaces tend to be longer due to the specialized fit-outs required, and they’re often structured as net leases, meaning tenants cover outgoings—an added benefit for landlords.

Lease terms vary widely depending on the property’s size. Smaller industrial units tend to have shorter leases with a higher volume of potential tenants, typically in the range of 2 to 5 years. In contrast, larger properties tend to attract fewer tenants but offer longer lease terms, often extending up to 10 years or more. Most leases in the sector, however, fall within the 3 to 5-year range with options for renewal.

Australia’s industrial real estate market has seen a notable boost from the rise in e-commerce, which drives demand for warehouses and distribution centers. As consumers increasingly shop online, the need for efficient storage and delivery solutions has pushed vacancy rates to record lows, driving strong capital growth and rental yield potential in the industrial sector.