Industrial occupiers increasingly looking beyond capital cities to regional markets: Knight Frank

Australia – Industrial occupiers are increasingly expanding their search beyond Australia's major capital cities to improve supply chain resilience, access key freight routes, reduce occupancy costs and position themselves closer to growing customers, suppliers and workforces, according to Knight Frank.

The firm’s just-released Regional Reach publication for its Industrial Occupier Services business line highlights growing opportunities for businesses seeking greater flexibility, operational efficiency and long-term scalability, with a number of regional locations across Australia offering access to critical infrastructure, skilled workforces and expanding population catchments.

Knight Frank Partner, Tenant Representation – Industrial Richard Trumbull said industrial occupiers were reassessing traditional location strategies as business needs continued to evolve.

"Many national occupiers have historically focused their industrial footprint around the major metropolitan markets, but we're seeing increasing interest in regional locations that can deliver significant operational and cost advantages," he said.

"Regional markets are no longer simply overflow options. For many businesses, they are becoming strategic destinations in their own right, supported by improving transport infrastructure, major renewable energy and mining related projects, growing consumer demand and access to labour."

Mr Trumbull said occupiers were taking a more holistic approach to property decisions, considering factors such as workforce availability, freight connectivity, business resilience and long-term growth potential alongside rental and land costs.

"The right regional location can provide occupiers with opportunities to future-proof their operations while maintaining strong access to customers, suppliers and distribution networks," he said.

The publication identifies a number of standout regional industrial markets across Australia, including locations benefiting from major transport investment, population growth, renewable energy development, mining projects and expanding manufacturing and logistics activity.

These include Wollongong, Newcastle, Tamworth, Central Coast and Wagga Wagga in New South Wales, Cairns, the Gold Coast, Bundaberg and Mackay in Queensland, Kalgoorlie and Port Hedland in Western Australia and Geelong in Victoria. These are locations that Knight Frank and McGrath have strong footprints or market knowledge.  

"Each region offers its own competitive advantages, whether that's proximity to ports, access to major freight corridors, lower rents, proximity to infrastructure and mining projects, available land supply or strong population and workforce growth," Mr Trumbull said.

“The opportunity is not the same in every market. Established logistics and port locations, manufacturing centres, mining regions and agribusiness hubs each have different drivers, constraints and levels of property availability.

“Continued investment in road, rail, port and intermodal infrastructure is strengthening key regional corridors, but occupiers still need to carefully assess labour availability, transport costs, servicing capacity, contract tenure, competition and future expansion requirements.

"The key for occupiers is understanding which markets align with their operational requirements and engaging early to secure the best outcomes as demand continues to strengthen.”

The report also notes that early planning and market engagement are becoming increasingly important for occupiers, particularly in locations where quality industrial stock and developable land remain limited.

“For some sectors, property requirements can also change quickly as contracts are won, extended or lost,” said Mr Trumbull. “This makes flexibility, speed to market and avoiding unsuitable long-term commitments especially important.

"Businesses that begin evaluating their options well ahead of key lease events place themselves in a much stronger position to optimise costs, improve operational efficiency, identify compliant properties and support future growth.

“We help occupiers get ahead of that growth and manage their property requirements across Australia through a single point of contact and with the support of our unrivalled Knight Frank and McGrath regional footprint. By understanding where a business is heading, testing the right markets and entering those markets early, we can identify opportunities before they become obvious or widely available.”

To read Knight Frank’s Regional Reach publication please click here.

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For further information, please contact:
Vanessa De Groot – Marketing & Communications, Knight Frank
Vanessa.degroot@au.knightfrank.com +61 410 460211

Notes to Editors
Knight Frank LLP is the leading independent global property consultancy. Headquartered in London, the Knight Frank network has 600+ offices across more than 50 territories and more than 20,000 people. The Group advises clients ranging from individual owners and buyers to major developers, investors, and corporate tenants. For further information about the Firm, please visit www.knightfrank.com.