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Perth’s industrial and retail sectors took the lion’s share in 2024, with the commercial property market expected to grow further in 2025.
According to the Real Estate Institute Western Australia’s (REIWA) latest WA Commercial Property Update, the industrial and retail sectors led the market, with a 15.1 per cent increase in the median sale price per square metre (sqm).
REIWA’s chief executive officer, Cath Hart, said while the industrial and retail sectors performed well, the office sector lagged behind.
“The office sector saw moderate growth over the year, recording a 7.6 per cent increase in its median sale price per sqm,” Hart said.
“Price rises are likely to continue in 2025, with REIWA members reporting a strong increase in market activity and enquiry at the start of the year.”
The report showed that by December 2024, Perth’s industrial market’s annual median sale price per sqm had reached $2,605, an increase of 15.1 per cent year over year.
Perth’s north-west subregion recorded the highest median sale price at $2,857, followed by the south-west subregion at $2,624.
In total 1,016 industrial sales were recorded in Greater Perth over the year to December 2024, an 11 per cent decline from the previous year.
Hart said the decline was due to limited supply rather than reduced demand.
“The greatest challenge has been new supply, with limited land for new development and construction costs hampering investment in building,” Hart said.
“Construction costs are stabilising, and members report east coast developers are buying land, so that may see new projects come to market and ease demand slightly.”
The report showed that Perth’s south-east subregion recorded the highest number of sales at 270, followed by the north-west and south-west at 257 and 253 sales, respectively.
The update indicated that more than a third of industrial sales across Perth were priced between $1 million and $5 million.
REIWA’s update also revealed that the retail sector saw the largest increase in sales activity last year, with transactions rising by 27.5 per cent to 195 sales in the year to December.
Hart said the increase in sales activity in the retail industry could indicate changes in investor interest.
“Our members report higher prices and reduced yields in the industrial market and are seeing some buyers look to other opportunities such as retail,” she said.
According to REIWA’s update, the inner subregion recorded the highest number of sales at 44, followed by the south-west subregion at 39.
The data revealed that the retail sector’s annual median sale price per sqm in 2024 was $4,928, a 15.1 per cent increase from the previous year.
It marked Perth’s inner subregion as the highest median price at $7,811, followed by the south-west subregion at $5,424.
Approximately 28.6 per cent of retail sales were priced between $250,000 and $500,000, according to REIWA’s update.
The report also showed that the office market experienced moderate growth in 2024, with the annual medium sale price per sqm increasing by 7.4 per cent to $4,370.
It indicated that Perth’s inner subregion recorded the highest median price at $4,722, followed by the south-west subregion at $4,565.
REIWA’s data noted that 355 office sales were recorded in Greater Perth in the 12 months to December 2024, a 22 per cent increase from the previous year.
It was reported that the Inner subregion accounted for 45.1 per cent of total office sales with 203 transactions.
Across Perth, REIWA’s data recorded that 35.3 per cent of office sales were priced between $250,00 and $500,000.
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