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The Melbourne-to-Brisbane Inland Rail project is anticipated to transform the movement of freight around the country and significantly impact industrial property, its users and providers across regional Victoria, New South Wales and Queensland, as found by research carried out by commercial real estate company, Colliers International.
According to the findings of the Colliers Radar: The Melbourne – Brisbane Inland Rail report, the 1,700km Inland Rail project – planned for completion in 2024/25 – is expected to result in potential creation of new intermodal facilities and transport and logistic hubs in key strategic locations; the relocation and/or emergence of inter-capital freight users to key strategic locations; potential uplift in industrial land values for precincts in proximity to the rail route (occupier-led demand); and higher importance placed around the existing Ports of Brisbane and Melbourne.
“From commercial property perspective, the regions which are most likely to benefit from the completion of the Inland Rail are Darling Downs, Acacia Ridge and Bromelton in Queensland, Tottenham in Victoria and Parkes in New South Wales,” said Malcom Tyson, Managing Director – Industrial, Colliers International.
“We are likely to see increased activity along the Inland Rail route from the inter-capital freight users such as Linfox, CEVA Logistics, Toll Holdings, DB Schenker, DHL, Woolworths, Coles, GrainCorp, Bluescope and Visy.”
Tyson noted that the benefits for these users would range from operating cost savings, time savings, improved reliability, improved availability and resilience to incidents.
“In line with this, providers of the intermodal transport and logistic hubs and industrial estates may also emerge to cater for the increased demand and relocation requirements from these users,” he added.
“These providers might fall into service industry sectors such as cold-store warehousing, grain and commodities storage, rail maintenance, container park, food processing facilities, freight handling facilities, distribution centres and inland container storage facilities.”
Matthew Frazer-Ryan, National Director – Industrial, Colliers International, added, “There is compelling evidence pointing towards the positive correlation between new infrastructure projects (i.e. when committed and under construction) and associated uplift in industrial land value in a region.
“The importance of these projects to improve accessibility of freight to the area is also likely to positively impact on the potential rental value of the industrial property in the region.”
Frazer-Ryan added that this has been evidenced Melbourne during the CityLink Tulla Widening project and the beginning of the West Gate Tunnel project – directly impacting transport and logistic operators in the region and leading to an uplift in values.
In Brisbane, he added, this was evident with the completion of the Gateway Upgrade, which saw land values in the Australia TradeCoast rise upon announcement of the project.
In Sydney, the Westlink M7 Motorway construction saw average annual land value growth in the M7 catchment area of around 22 per cent over the three-year period.
“As a result, we would anticipate that as firms begin to look to these middle suburban ring and outer regional areas supported by the completion of the Inland Rail, stronger demand should lead to increasing land values and overall industrial property performance over the long-term,” added Frazer-Ryan.