Australian Logistics & Industrial Capital Markets Outlook 2025

LOGISTICS & INDUSTRIAL OUTLOOK 2025

THEME 2: INVESTMENT VOLUMES TO PICK-UP PACE

TOTAL TRANSACTIONS IN 2024 $7.2bn FORECAST TRANSACTIONS FOR 2025 $10.0bn

Nationally, investment volumes for L&I recovered in 2024, with a material upswing recorded off the back of several large transactions. Volumes appeared to have bottomed in Q1 2024 and have since gained traction. Looking ahead to 2025, volumes are expected to continue to recover, supported by a large amount of regional capital looking to be deployed. We anticipate investment volumes for L&I will reach approximately $10.0 billion in 2025, representing an approximate 40% increase on 2024 volumes ($7.2 billion). This is in line with previous cycles where volumes recover quickly once clarity on pricing occurs, and the book value unwinding cycle has run its course. Further, lender support for L&I assets remains, which will support deal activity for the year. Volumes for 2026 are expected to moderately weaken to approximately $8.5 - $9.0 billion, reflecting stock becoming more tightly held as investors hold through the compression cycle. It is important to remember that even at investment volumes of $11.0 billion, it still represents less than 4% of Australia’s total L&I investable universe as assets remain tightly held. Volumes in 2025 are expected to originate from a variety of sources, including: Recapitalisations: Investors in 2025 will remain reluctant to trade assets outright, which will support further recapitalisation activity. Capital relationships will remain integral to these campaigns’ success. Portfolios: The challenge of building scale within the Australian L&I sector will mean that portfolios will be highly pursued, and several investors will likely take advantage of this demand.