Gladstone’s commercial property market is rebounding strongly from its post-2012 slump, new data from Ray White Commercial shows.
In the first nine months of 2017, sales of $55.341 million have been recorded — a 172.59 per cent increase on the full 2016 year and the highest since the record of more than $100 million in 2012.
To date, the 2017 figure is more than eight times higher than the total of $6.26 million recorded in the 2015 calendar year, according to the Between the Lines Gladstone Commercial Markets October 2017 brief.
Ray White Commercial Head of Research Vanessa Rader says the improvement in sales turnover during 2017 is encouraging for Gladstone, a market known for its volatility and which has taken a heavy hit since 2012 after a period of major investment in infrastructure related to the liquified natural gas (LNG) industry.
“Receivers have been active in bringing assets to the market after a long period of inactivity,” Ms Rader says.
“Also encouraging for Gladstone are the quality port operations which continue to accept and move growing tonnes of raw materials and cargo between Australia and major markets including China, India, Japan and Korea.”
Ray White Gladstone director Andrew Allen says the biggest transaction recorded in 2017 is the Charter Hall sale of Gladstone Square, selling for $31.5 million and reflecting a tight yield of 7.25 per cent.
“In addition to this large sale, industrial activity to date has accounted for more than $10 million across six transactions which vary in size from larger facilities to vacant land and vacant possession, smaller industrial assets,” Mr Allen says.
“While capital values may have seen reduction since the peak of this market, some confidence has returned to this market resulting in this uptick in investment demand.”
Ms Rader says the Gladstone results may signal a resurgence of interest in regional towns as cheaper alternatives for property investors priced out of other markets.
“While investment demand is high generally across the east coast due to low interest rates and rapidly reducing investment yields rendering some locations unaffordable, the return to these towns is likely as investors move up the risk curve in anticipation of the next big boom for Gladstone,” Ms Rader says.