WA MARKET OVERVIEW
WESTERN AUSTRALIA
WA Market Overview with Brett Wilkins
What are the key market trends occurring throughout 2022 in your region? Industrial property from large scale logistics to fabrication workshops continue to have strong demand from tenants, owner occupiers and investors, with virtually nil vacancy and limited supply. This is all primarily being driven by demand in mining, construction and renewables. Healthcare assets continue to be keenly sought after from private investors, national REITS and syndicators as does non-discretionary retail property. Undervalued but with rising demand in 2022 are offices both suburban and CBD as well as service stations which have been undervalued with undue concern about electric cars. Like everywhere else in Australia the surge in building costs combined with lack of workforce and three major construction companies being wound up has meant that large developments are problematic What have been the fundamental drivers of demand amongst buyers? The main drivers shared nationally has been the abundance of cheap money combined with the very strong Western Australian economy. There has been increased demand from investors and developers based in the Eastern States as a result of pricing differentials, attractive yields on offer and a perception that WA is a countercyclical economy.
Reflecting on recent transactions, what has been the profile of buyers and has this shifted from previous years? The principal International transactions in Perth has been from Singapore but during the Covid lockdowns there was a significant drop in Singapore inquiries though this has started to turn around with the opening of the hard WA border. Transactions from Eastern States buyers both small privates through to large REITs continue as always What types of assets are most in-demand given the current environment? Keenly sought after assets are healthcare properties, industrial parks, non-discretionary retail and suburban offices What are your expectations for the commercial property market over the next twelve months? The recent rises in interest rates combined with shifting consumer sentiment will cause some concern to buyers and the very low yield assets may be repriced however I expect that this may be offset by the very strong outlook for the WA economy and the value differentials to the eastern states which make WA property attractive Talk us through the most significant deals you have transacted thus far in 2022 2021 finished for me with the settlement of Jandakot Airport for $1.3 billion so my transactions for 2022 have been somewhat smaller with the principal deals so far being 4 medical centres for a combined $79 million and two office buildings in West Perth.
BRETT WILKINS SENIOR COMMERCIAL PROPERTY ADVISOR RAY WHITE COMMERCIAL
74 –June / July 2022
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