CORPORATE PARK EAST DECEMBER REPORT

Corporate Park East December Owner’s Report

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Corporate Park East Summary Market Sentiment: Following this month’s interest rate rise, there has been a slight dip in property inquiries and some reluctance from tenants in particular to make offers. This is the same pattern we saw in June after the last rise, so we are not overly concerned. It is likely that business owners might defer decisions until 2024, but we are working to create urgency and highlight the benefit of moving over the Christmas break.

Sentiment towards the Northern Corridor and industrial assets in particular continues to improve, driven by population growth projections from now to the Olympics. Some major future development projects may offer future solutions to our industrial land supply shortage, but nothing is expected to deliver complete lots within five years. We expect prices to continue pushing up for the foreseeable future.

Final Stage Construction: Construction of the final stage of Corporate Park East is now well under way, with completion expected in the third quarter of 2024. It is expected we will see the first buildings completed on this new stage in early 2025.

The rapid rate of sale for this final stage, as well as the strong uplift in average sale rate, has led to immediate equity uplift for existing owners in the first three stages of Corporate Park East.

Demand Summary Owner Occupiers: Despite the interest rates, the owner-occupier market remains robust. Finance is proving harder to secure but there is still appetite among lenders. Valuers are more cautious, so we are working harder to convert under contract deals than a year ago Investors: The investor sector continues to soften, primarily driven by heightened expectations regarding yields and tenant security. There is still good demand once a new lease has been negotiated.

We are working to offset the increase in yield expectation by highlighting the increasing capital values due to construction costs and land scarcity.

Tenants: A significant shift has been observed in tenant incentive expectations. Unlike the minimal expectations of last year, tenants are now factoring in incentives such as rent-free periods, staged rent, or contributions to fit-outs. Encouragingly, tenants are displaying little pushback to the face rents, so long as they are receiving some “love” in terms of incentive. This is helping to protect the capital values across all building sizes.

The demand pulse in the market is being led by trade services, particularly electricians and builders. This aligns with the ongoing residential growth across the region.

“Industrial capital growth across Australia has outperformed all other sectors in the last twelve months. This, combined with growth of 13.6% in the first three quarters of 2023 is keeping industrial property at the top of investors’ wish-list” - Ashley Rees, RWC NCG Senior Analyst

Recent Transactions Key takeaways We have seen the bulk of transactions occur either on completion of buildings or once walls have been erected. Finance approvals only remain valid for 90 days, so most buyers relying on finance have been unable to commit unconditionally until completion dates are certain.

Status

Date

Leased

01/05/2023

Leased

Address

Size/m

Price/m

4/64 Evans Drive

118

$153

14/08/2023

6/60 Evans Drive

136

$201*

Leased

01/08/2023

3/60 Evans Drive

171

$158

Leased

16/06/2023

1/53 Evans Drive

200

$165

Leased

09/10/2023

2/53 Evans Drive

200

$165

Leased

15/01/2023

1/64 Evans Drive

287

$161

Leased

11/07/2023

2/24 Evans Drive

300

$140

Leased

01/03/2023

3/2 & 12 Alta Road

942

$140

Leased

01/04/2023

44 Evans Drive

1200

$140

Address

Size/m

Price/m

2

2

*Gross

Status

Date

Sold

20/03/2023

6/60 Evans Drive

136

$2,794

Sold

17/11/2023

3/23 Evans Drive

158

$3,354

Sold

08/11/2023

2/23 Evans Drive

160

$3,375

Sold

01/11/2022

7/60 Evans Drive

161

$2,919

Sold

23/02/2023

1/23 Evans Drive

168

$3,720

Sold

17/05/2023

4/23 Evans Drive

170

$3,500

Sold

10/01/2023

5/60 Evans Drive

171

$2,917

Sold

23/01/2023

2/60 Evans Drive

171

$2,917

Sold

09/02/2023

4/60 Evans Drive

171

$2,917

Sold

08/02/2023

1/60 Evans Drive

279

$3,154

Sold

07/03/2023

2-12 Alta Road

2698

$2,039

2

2

Current Stock on Market Stock Summary We see a clear gap in available stock in the 300 - 1,000m2 range in both lease and sales at the moment. These are traditionally a tricky size to design on sub-3,000m2 blocks. While there have been quite a few complexes complete or approach completion at the same time, the rate of absorption to date and lack of stock across the region means we do not expect to see any softening of rates.

Under Construction

Complete

0-150m2

0

0

150-300m2

4

300-600m2

Under Construction

Complete

0-150m2

4

3

10

150-300m2

9

5

1

3

300-600m2

1

0

600-1,000m2

0

1

600-1,000m2

0

0

1,000m2+

2

2

1,000m2+

3

2

Total

7

16

Total

17

10

Lease

Sale

Current Properties Under Contract/Offer

Property

Size

$m2

$

Leased/Sold

3/20 Alta Road CABOOLTURE

206

$2,767

$570,000

Under Contract

Unit 6/ 27-31 Alta Road CABOOLTURE

348

$2,443

$850,000

Under Contract

4/ 20 Alta Road CABOOLTURE

325

$2,815

$915,000

Under Contract

5/20 Alta Road CABOOLTURE

341

$2,859

$975,000

Under Contract

1/36-40 Alta Road, CABOOLTURE

543.2

$2,475

$1,344,500

Under Contract

1&2/20 Alta Road CABOOLTURE

685

$2,774

$1,900,000

Under Offer

35 Alta Road CABOOLTURE

1300

$160

$208,000

Under Offer

9/ 16 Alta Road CABOOLTURE

376

$160

$60,160

Under Offer

Current Sale Stock on Market Property

Size

Sale $m2

Sale $

Status

5/23 Evans Drive CABOOLTURE

136

$3,308

$449,900

Complete

6/ 23 Evans Drive CABOOLTURE

140

$3,571

$500,000

Complete

7/ 23 Evans Drive, CABOOLTURE

144

$3,472

$500,000

Complete

4/36-40 Alta Road, CABOOLTURE

147.4

$3,050

$449,500

Under Construction

14 /36-40 Alta Road, CABOOLTURE

147.4

$3,050

$449,500

Under Construction

15 /36-40 Alta Road, Drive, CABOOLTURE

147.4

$3,050

$449,500

Under Construction

5/36-40 Alta Road, CABOOLTURE

149.1

$3,015

$449,500

Under Construction

5/ 31 Alta Road CABOOLTURE

179

$3,017

$540,000

Complete

6 / 11 Alta Road CABOOLTURE

184

$3,000

$552,000

Under Construction

2 / 31 Alta Road CABOOLTURE

198

$2,942

$582,600

Complete

3 / 31 Alta Road CABOOLTURE

198

$2,942

$582,600

Complete

4 / 31 Alta Road CABOOLTURE

198

$2,942

$582,600

Complete

2 / 11 Alta Road CABOOLTURE

212

$3,000

$636,000

Under Construction

3 / 11 Alta Road CABOOLTURE

212

$3,000

$636,000

Under Construction

4 / 11 Alta Road CABOOLTURE

212

$3,000

$636,000

Under Construction

5 / 11 Alta Road CABOOLTURE

212

$3,000

$636,000

Under Construction

1 / 11 Alta Road CABOOLTURE

214

$3,000

$642,000

Under Construction

3/36-40 Alta Road, CABOOLTURE

225

$2,887

$649,500

Under Construction

16 / 36-40 Alta Road, CABOOLTURE

225

$2,887

$649,500

Under Construction

17 / 36-40 Alta Road, CABOOLTURE

226.1

$2,873

$649,500

Under Construction

1 / 27-31 Alta Road CABOOLTURE

229

$3,002

$687,500

Complete

5/44 Alta Road CABOOLTURE

464

$2,750

$1,276,000

Under Construction

1 / 27 Alta Road CABOOLTURE

1029

$2,350

$2,418,150

Complete

2 / 27 Alta Road CABOOLTURE

1067

$2,229

$2,378,050

Complete

39 Alta Road, CABOOLTURE

1300

$2,800

$3,640,000

Under Construction

59 Evans Drive CABOOLTURE

1384

$2,746

$3,800,000

Under Construction

59 Alta Road CABOOLTURE

3100

$2,806

$8,700,000

Under Construction

Current Lease Stock on Market Property

Size

Lease $m2

Lease $

Status

2/ 60 Evans Drive CABOOLTURE

171

$175

$30,000

Complete

4 / 60 Evans Drive CABOOLTURE

171

$175

$30,000

Complete

5/60 Evans Drive CABOOLTURE

171

$175

$30,000

Complete

Unit 5/ 27-31 Alta Road CABOOLTURE

179

$180

$32,220

Complete

Unit 2/ 27-31 Alta Road CABOOLTURE

198

$188

$37,224

Complete

Unit 3/ 27-31 Alta Road CABOOLTURE

198

$180

$35,640

Complete

Unit 4/ 27-31 Alta Road CABOOLTURE

198

$180

$35,640

Complete

Unit 1 / 27-31 Alta Road CABOOLTURE

229

$190

$43,510

Complete

2/44 Alta Road CABOOLTURE

230

$180

$41,400

Under Construction

3/44 Alta Road CABOOLTURE

230

$180

$41,400

Under Construction

1/44 Alta Road CABOOLTURE

247

$182

$45,000

Under Construction

4/44 Alta Road CABOOLTURE

260

$180

$46,800

Under Construction

8 / 60 Evans Drive CABOOLTURE

278

$179

$49,762

Complete

1/60 Evans Drive CABOOLTURE

297

$178

$52,800

Complete

6/ 16 Alta Road CABOOLTURE

363

$160

$58,080

Complete

7/ 16 Alta Road CABOOLTURE

394

$150

$59,100

Complete

5/44 Alta Road CABOOLTURE

464

$170

$78,880

Under Construction

5/ 56 Evans Drive, CABOOLTURE

466

$161

$75,000

Complete

4/2-12 Alta Road, CABOOLTURE

844

$160

$135,040

Complete

Warehouse 1/ 27-31 Alta Road CABOOLTURE

1029

$145

$149,205

Complete

Warehouse 2/ 27-31 Alta Road CABOOLTURE

1067

$140

$149,380

Complete

59 Evans Drive CABOOLTURE

1384

$160

$221,440

Under Construction

59 Alta Road CABOOLTURE

3100

$180

$558,000

Under Construction

Construction Progress

Your NGC Caboolture Team

Chris Massie Director 0412 490 840 chris.massie@raywhite.com

Aaron Canavan Commercial Principal 0447 744 948 aaron.canavan@raywhite.com

Troy Sturgess Sales & Leasing Executive 0432 701 600 troy.sturgess@raywhite.com

Natasha Grima Sales & Leasing Executive 0468 393 334 natasha.grima@raywhite.com

Michaela Webb Executive Assistant Chris Massie 0409 202 066 michaela,webb@raywhite.com

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