Growthpoint Properties Australia (Growthpoint) is targeting the Brisbane and western Sydney industrial and logistics property markets to grow its new Growthpoint Australia Logistics Partnership (GALP).
GALP was established in late 2024 with six existing Growthpoint industrial assets located in Melbourne, Sydney, and Southeast Queensland (SEQ), valued at $198 million. Growthpoint is the investment and property manager for the assets.
GALP has recently exchanged contracts for the purchase of a $40 million industrial and logistics asset in Stapylton, Queensland and is actively pursuing further opportunities to expand the partnership with further acquisitions of high-quality assets.
“We’re really positive on industrial and logistics, it’s a very appealing sector,” says Michael Green, Chief Investment Officer at Growthpoint.
“We think there’s good momentum from a macro level although some of the micro market conditions are a bit challenging in certain areas.”
Green thinks Brisbane and western Sydney offer the best investment opportunities because of infrastructure development and population growth, while Melbourne’s north and northwest is impacted by excess supply.
On Sydney’s outskirts, growth is being propelled by the development of the Western Sydney International Airport at Badgerys Creek plus the roads, freeways and rail lines servicing it.
There is further growth in the southwest region including the planned city of Bradfield.
A lot of people are moving to both regions. The population growth forecast for SEQ is 1.8% per annum1, just behind western Sydney at 1.9% per annum2.
“We like Sydney and Brisbane,” he says. “The outer west of Sydney has a little bit of supply on the horizon but over time we think that’s going to be a very resilient and well performing market.
“Brisbane is a big growth story with spending on mining, health, transport and sporting infrastructure ahead of the 2032 Brisbane Olympics, and we think that presents buying opportunities for existing assets because new construction is challenging due to competition from Government infrastructure projects.”
“From an immediacy perspective our focus is on Sydney followed by Brisbane and southeast Melbourne.”
Proforma for the recent acquisition, Growthpoint’s industrial platform is valued at approximately $1.7 billion, comprising 30 properties across New South Wales, Queensland, Victoria, Western Australia and South Australia, running at 98% occupancy.3
The business is underpinned by significant multi-tenancy partnerships with some of Australia’s biggest companies including Woolworths, Linfox and Australia Post.
An established portfolio enabled Growthpoint to benefit from the post-COVID industrial boom, when rents rose with “unprecedented velocity” as did capital values across all major markets.
Face rent growth in the twelve months to 31 December 2024 were 9.0% in Sydney, 10.8% in Melbourne and 12.9% in Brisbane4, and Growthpoint’s releasing spreads on its directly owned industrial properties was 21% in the 6 months to December 2024.
“We’re still seeing rent growth, just not at the same unsustainable velocity, reflecting the better balance between supply and demand,” says Green.
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