The booming e-commerce sector has provided strong returns for investors and demand is high for the assets, as evidenced by the more than $7 billion in sales over the past few years.
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One of the latest was by Altis Property to the Singaporean Mapletree investment fund for $85 million for a collection of industrial warehouses across NSW from Altis Property.
It marks the break-up of the Altis portfolio, worth a total $285 million covering nine warehouses and logistics properties.
Under the deal, Mapletree will buy four properties in Mount Druitt, Wetherill Park, Smithfield and Huntingwood. Mapletree already owns a distribution centre in Eastern Creek, leased to Coles.
The new properties are all fully leased, according to the agents advising the deal, Gavin Bishop and Roger Miller of Colliers International.
The deals come as industrial property is in hot demand to store and distribute items for manufacturing and from internet shopping.
Globally, demand is also very strong, as evidenced by the recent lease to Amazon by Goodman Group.
Goodman's United States team signed a new 93,000 square metre leasing deal with Amazon at Goodman Commerce Centre Eastvale in Southern California.
The facility is the first of two buildings which will comprise a 186,000 sq m distribution campus and is being constructed by Goodman Birtcher as part of its overall Goodman Commerce Centre Eastvale development.
In Australia in the past two years, unprecedented levels of investment have imposed downward pressure on transaction yields, according to the latest research from Colliers International.
In similar fashion to 2014, Sydney has remained the most popular location for industrial investment in the Asia-Pacific region. Sydney's preference as an investment destination mirrored the nation's wider economic conditions.
Malcom Tyson, managing director, industrial, at Colliers International, said this level of demand was unsurprising given Sydney's function as the engine room for Australia's new era of services-dependent growth.
"While other states face headwinds caused by the legacy of the mining boom, Sydney's labour market has vastly improved in midst of a healthy growth rate. Above all, the implicit uplift in Sydney's industrial properties is underscored by an infrastructure boom. The 2015 state budget committed $68.6 billion in infrastructure spending in the next four years."
He said Sydney's industrial assets would remain in high demand given their favourable risk-adjusted return.
"The global demand for return in a low-yield environment will underpin the pursuit for Sydney's industrial assets moving forward," he said.
The reduction in inventory brought to market will drive the value placed in multi-asset acquisition. Last year, the $1.07 billion GIC industrial portfolio was among the $1.33 billion industrial portfolio sales nationally.
Anthony Mylott, national director, industrial valuations and advisory services, at Colliers International, said of these the Sydney market accounted for $567 million of sales – about 44 per cent of national sales by value.
It is understood the JP Morgan portfolio is in the final stages of completion, while eight assets in the Charter Hall Portfolio were recently acquired by PropertyLink for $135.3 million.
"Sydney's Western industrial markets are undergoing a transformation not seen in years. The inner markets remain tight, with withdrawals for alternate use forcing tenants to the north west and outer west," Mr Mylott said.
