A recent survey by Colliers International found that 89 per cent of Australian industrial investors favoured the logistics sector over other commercial sectors.
According to results from the Colliers International Industrial Investment Survey, the biggest impact of COVID-19 on industrial occupiers has stemmed from revenue loss, increased cost of doing business and idle capacity which collectively impacted 55 per cent of businesses.
However, 43 per cent of survey respondents intend to acquire their next industrial asset within the next six months.
Luke Crawford, Associate Director, Research at Colliers International said occupiers remain optimistic about current trading conditions with 53 per cent expecting their volume of business to be better off or the same as it is now over the next three months.
“75 per cent expect their workforce to remain the same or grow over the next 24 months,” he said.
“To achieve efficiencies and better respond to the impacts of COVID-19 on their business, 85 per cent of occupiers have reviewed their supply chain network, while 30 per cent plan to relocate to a bigger warehouse over the next year.”
Malcom Tyson, Managing Director, Industrial at Colliers International said despite recent market uncertainty, 89 per cent of investors surveyed expect the market to stabilise in around 12 months.
He said Sydney and Melbourne remain the focus cities for investors with almost 60 per cent of investors saying they are very likely/likely to invest in these capital cities within the next year.
According to the survey, Investors see tenant solvency and the re-pricing of assets as the biggest challenge facing investors amid the current health crisis.
Almost a quarter of respondents reported minimal impact on their business as a result of COVID-19, with nearly three quarters already having a risk management plan in place.