Why Are Commercial Rents Increasing on Brisbane’s TradeCoast?

Rising commercial rents on Brisbane’s TradeCoast are squeezing out tenants and forcing them to look for more affordable locations. We take a closer look at the factors driving these rental increases, and where these tenants will go.

How Significant Are These Rental Increases?

The most recent Brisbane Industrial Market Overview, published by real estate firm Knight Frank, found prime rent was stable at an average of $116 per metre squared. However, this stability made these properties much more expensive than in Brisbane’s North and South East, the next most expensive districts. Here rents cost $107 and $105 per square metre, less than they did in the last report. Secondary rents have increased by 3.4 percent at a time when rents in every other Brisbane region have fallen by at least 2.4 percent. Secondary properties now cost $95 per square metre, $9 more per square metre than the city average.

What’s Driving Rising Rents?

Growing demand for warehouses of all grades close to Brisbane’s port and airport has driven rents in the TradeCoast sky-high. This master-planned corporate office park and industrial community is well serviced by the adjacent Gateway Arterial Motorway. With around 1,500 businesses represented here, TradeCoast appeals to companies wanting to be close to clients and competitors.

Where Will the Tenants Go?

Brisbane’s western corridor is likely to experience substantial growth as tenants evacuate the TradeCoast. A new CBRE ViewPoint report noted companies could save between $5 and $15 per square metre on property in the western corridor. The average tenant would save $100,000 every year on a 10,000 square metre facility. Those cost savings might not have traditionally been enough to entice tenants, but innovations in the land transport industry and the falling price of oil mean industrial businesses no longer need to be near transport hubs to operate successfully. If you want to take advantage of interest in the western corridor, speak to TPM Builders to learn more about our design and construct services. Moving outside the TradeCoast won’t suit everyone, but there are savings to be made for businesses willing to move away from Brisbane’s transport hubs. ©Image via Flickr by eGuide Travel