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Australian Investors Very Much Interested in Warehouses

The boom in e-commerce and the rising use of the internet will bring boom-time conditions to the industrial property sector in Australia in the coming year, according to logistics leasing experts.

With internet sales tipped to top $20bn in Australia this year, owning a distribution facility and warehouse will be a priority for many investors, from super funds and real estate investment trusts to small investors.

New research from Jones Lang LaSalle and Colliers International shows the already scarce supply of suitable industrial assets will be even tighter this year.

According to Richard Thompson at Jones Lang LaSalle, as e-commerce logistics models develop, they will drive huge changes in physical distribution networks comparable with previous changes generated by the rise of global sourcing, or the earlier centralization of deliveries to retail stores via retailer-controlled distribution centres.

''This will give rise to a new class of logistics and distribution properties, including mega e-fulfillment centres, parcel hubs and delivery centres, local 'urban logistics' depots for rapid order fulfillment, and returns processing centres,'' he said.

Malcom Tyson, managing director (industrial) at Colliers International, said logistics would dominate leasing in the coming year.

''During the second half of 2013, the industrial market featured some notable leasing transactions undertaken by logistics specialists,'' he said. ''This occurred as retailers and logistics firms continue to come under increasing pressure to adapt to the next phase in e-commerce.''

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