Industrial was the top performing sector for price growth in the Perth commercial market in the year to September 2024, according to REIWA’s September Commercial Property Update.
The annual median sale price per sqm for the Perth industrial market was $2,500 at the end of September, representing a 12.1 per cent increase year-on-year, and 4.6 per cent higher than the 12 months to June 2024.
REIWA CEO Cath Hart said the industrial market continued to be driven by strong demand and limited supply.
“Ongoing competition for industrial property is maintaining the upward pressure on prices,” she said.
“Our members report strong demand from owner-occupiers and multiple offers on smaller lots.
“Urban infill subdivisions are particularly attractive, but supply challenges persist, with most new land releases located on Perth’s outskirts.”
The North West sub-region had the highest annual median sale price per sqm at $2,819, closely followed by the Inner sub-region at $2,815 per sqm.
A total of 1,048 industrial sales in the Greater Perth region have been recorded so far during the 12 months to September 2024. Compared with the previous year sales were down 7.7 per cent.
The South East sub-region had the most sales, with 281. The North West and South East sub-regions followed, with 262 sales each.
Across Perth, 34.6 per cent of industrial sales were priced between $1 million and $5 million.
Office
The office market also saw significant growth.
The annual median sale price per sqm at the end of September was $4,408, 7.6 per cent higher year-on-year and 6.7 per cent higher than the year to June 2024.
The Inner sub-region had the highest annual median sale price per sqm at $4,751, and accounting for 44.6 per cent of all office sales, with 186 transactions.
Ms Hart said strong demand for medical office spaces was a key driver of this growth and reflected Perth’s ageing population.
“Doctors are seeking ownership opportunities for their own rooms, particularly in the Western Suburbs,” she said.
“Larger clinics are also in demand across the broader Perth market.”
A total of 417 office sales in the Greater Perth region have been recorded so far during the 12 months to September 2024. Compared with the previous year sales were up 11.8 per cent.
Across Perth, 36.8 per cent of office sales were priced between $250,000-$500,000.
Retail
The retail market experienced the strongest growth in sales, with the number of transactions increasing 40.6 per cent year-on-year.
Ms Hart said the retail sector had seen significant growth in sales over the past year.
“Retail properties are performing strongly, with investors favouring sites leased to national brands on long-term agreements,” she said.
The annual median sale price per sqm at the end of September was $4,725, which was 10.0 per cent higher than 12 months ago, and 7.5 per cent higher than the 12 months to June 2024.
The Inner sub-region had the highest annual median sale price per sqm at $7,741 and narrowly led sales volumes with 47 transactions. It was closely followed by the South West sub-region, which had 45 sales.
Across Perth, 31.4 per cent of retail sales were priced between $250,000-$500,000.
REIWA’s September Commercial Market update comes in the wake of the State Government tabling its review of the Commercial Tenancy (Retail Shops) Agreements Act 1985 last month.
Ms Hart said the positive figures reinforced the importance of having retail market that balanced the needs of commercial landlords and tenants.
“REIWA is focused on advocating for a balanced and viable leasing environment for everyone in the sector,” she said.
“For example, we will be engaging with the State Government to ensure that smaller landlords, particularly those outside major shopping centres, are not disproportionately burdened by new compliance obligations.
“We also want to ensure that the legislation continues to support tenants, particularly in navigating lease agreements, while maintaining flexibility for landlords in challenging economic environments.
“I encourage landlords, agents, and tenants to engage with REIWA and provide feedback ahead of the consultation period next year.”
You can read the full commercial update here.
