Why invest in industrial real estate?

The demand for industrial property has increased in the recent years, with the growth driven by e-commerce, food logistics and infrastructure investments¹.

The New Zealand economy has proven resilient and is well placed to benefit from strong GDP growth into 2022. This is expected to further benefit the industrial real estate sector.

Additionally, land in desirable, centralised locations for industrial real estate development is becoming scarce. This in turn puts pressure on supply chain efficiencies. Given that half of supply chain costs come from transport, and only 5% from occupancy costs, finding a location which will minimise those costs is key – this means a location with good access to suppliers and customers is key.

These factors are expected to provide a continued strong tailwind to the industrial real estate sector.

1. Bayleys Realty Group