An insight into industrial development & repurposing assets

Jun 08 2022

Recently our talented National Development Manager, Charlotte Brabant, sat down for a chat with Tom Wallace, CEO and founder of the commercial management software, Re-Leased, to unpack the trends facing Australia’s most talked about asset class and how these are impacting Industrial development.

To listen to the full podcast, please click here. Courtesy of Re-Leased.

 

The growing trend of repurposing and repositioning assets

Over the past two years the Industrial sector has experienced unprecedented growth. The strong demand for prime-grade Industrial space and a shortage of supply, has caused many owners and developers to rethink how they maximise the value of their assets and meet the needs of their new and existing customers. For many, this means repurposing or repositioning their existing assets.

 

“Re-purposing and repositioning assets is becoming a growing trend for two reasons. Firstly, the growing demand for industrial that’s been supercharged by COVID and the e-commerce boom, coupled with the lack of land supply”.

 

This growing trend of repurposing or repositioning existing assets, often already in sought-after locations, is also important from an ESG point of view given the waste impact that results from redevelopments.

 

“A lot of buildings are built for a 40 – 50 a year lifespan and anything less than that would still have a lot of embedded energy wasted if you were going to knock it down and redevelop it. But also, ESG is now more front of mind – waste recycling, those sorts of aspects are things that landlords and customers are thinking about when they go into some of these projects.”

 

ESG – more than just sustainability

With ESG becoming a greater priority for customers as a result of climate change and the pandemic, sustainability initiatives such as solar panelling on roofs, LED lighting and rainwater harvesting in are now considered stock standard initiatives for new buildings. However, Charlotte points out that many customers are also now prioritising wellbeing and looking for buildings that provide a positive work environment for their employees.

 

“People recognise now that you spend so much time at work it should be a positive environment for everybody. When we look to specify a new building, we make sure that the bathrooms, kitchens and the offices have good natural light, quality finishes, and we make sure there is an outdoor space or breakout space for everybody to go and enjoy their lunch, plus solar access and accessibility to car parking is really important. Having amenity close by to the buildings that you build is also really important – it’s all about building an ecosystem that makes people thrive.”

 

The challenges facing industrial

With the rise of e-commerce in Australia as a result of COVID-19, the sector is experiencing unprecedented demand for prime-grade industrial buildings. However, it is this demand and reduced resourcing that is putting a lot of pressure on the construction and supply chain industries, which in turn is impacting owners’ getting developments underway – from planning to construction and design. Another immediate issue impacting developments is land supply and the need for adequate infrastructure to service new industrial precincts.

 

“Specifically in Australia, land supply, that’s a big issue for industrial as well. Zoning of appropriate land for industrial development, and then having the infrastructure to feed or serve those industrial sectors”.

 

Championing female participation in industrial

Charlotte is also a strong advocate for women entering or currently working in the industrial sector and sees this a big opportunity for the property sector moving forward.

 

“When I started 10 years ago, I was probably one of the few women in development. But now whether it’s in development or project management or design or construction or leasing, you’re definitely seeing greater female participation. I’m really excited to see that. And I’m really excited to see leaders in the industry really champion that as well.”