Mark Hay Realty Group principal Mark Hay said changing buying habits and supply chain congestion had caused an increase in demand for large industrial spaces.
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00:00For those of you who have been following me for a few years with my comments on the Perth
00:04property market will realise I've been on the soapbox for several years now about saying
00:09we have a residential property crisis looming, but no one was listening.
00:13I've been saying for the last 18 months or so now about industrial land and we're headed
00:17exactly the same way as we have done with the residential market.
00:22By modelling, they suggest that we use, basically in the past we've been using about 100,000
00:28square metres of industrial land per year.
00:31On current statistics from the Property Council, they have now forecast in the next four years
00:36we'll need a million square metres or more.
00:39Now clearly with the regional areas exploding with mining in many, many sectors, whether
00:45it's Esperance all the way up to Port Hedland, Carartha, Kalgoorlie.
00:49When you look at Arcus down the Henderson Conaway with the submarines, those ship buildings
00:53going to go through the roof.
00:55We've had a huge change in demand.
00:59People are now looking at getting the supply chain sorted by storing in warehouses or assembling
01:04items in warehouses.
01:06So there's a lot more demand for warehousing.
01:09Here in our business here, we've seen some prices double in rental values in two years
01:16and continue to push so.
01:17We also see investors coming from the East Coast because they realise our industrial
01:21market is grossly undervalued compared to theirs.
01:24And they see far greater upper side, just as they have in the residential side.
01:28But also we see owner occupiers smartly using their self-managed super fund or getting out
01:34and buying their own commercial premises to operate their business from, rather than paid
01:39rent.
01:40So I believe we're going to see once again, a huge shortage that is going to accumulate
01:45in people screaming out with increased rents, can't find anywhere to put their industrial
01:50or their commercial premises.
01:52And I'm forewarning that if we don't get on this one quick enough, the government of the
01:56day are going to miss the vote again on this.
01:58Please, everybody look at where we're going with this industrial situation and all hands
02:03to the wheel.
02:04Thanks guys.