Townsville industrial market has been in a holding pattern for the last two years, with 2015 expected to show some changes to the market.
The local economy has witnessed job losses, business closures which has resulted new high is unemployment; despite this confidence is slowly returning to the market which may signal a turning point for Townsville. Record low interest rates and the expectation of improved business conditions, possible infrastructure projects and an uptick in demand for space is likely to result in a positive 2015.
The 2014 result did however include a self storage facility for $17 million at 399 Woolcock Street, Garbutt, sold to National Storage REIT on reported yield of 7% which improved confidence in investment within the region. The entry price bracket sub $300,000 has remained reasonably steady over the last three years, representing approximately 10% of all sales, the largest growth price range in 2014 has come from the $300–$500K bracket which represented close to 30% of all sales up from sub 20% the previous year. The suburb of Garbutt has been the major driver of sales in this price point with sales in Mount Louisa and Mount St John strong in the over $500,000 price bracket. These sales have been driven by the low interest rate environment and the increase in owner occupation investment via SMSF’s as well as investors seeking a yield in the 7.5% to 9.0% band.
Industrial sales have been on the up during 2013 and 2014 after three consecutive years of limited turnover. 2014 recorded just shy of $110 million across 71 transactions, while this represents a 19% decline on 2013 results, this is up 93% on 2012 results which just yielded just 55 sales.