A ROBUST growing population that is well supported by investment into new infrastructure projects has resulted in a pickup in commercial property development in Tweed, according to Ray White’s latest Between the Lines report.

Ray White head of Research Vanessa Rader said that record lows in interest rates had also seen enquiry levels elevated by out of town buyers looking to capitalise on the sound fundamentals of the region and attractive investment yields.

“The Tweed region is an established commercial market that offers a mix of industrial product, retail both in showroom assets and strip retail, as well as office accommodation,” Rader said.

“This has historically been a very locally driven market with a high volume of sales transacting to local investors, developers and a growing number of small businesses looking for owner occupation.”

At a glance:

• Industrial holdings dominated sales activity over the past 12 months, representing $41.453 million, up 28.59 per cent on the prior financial year
• Record low interest rates lure out-of-towners into Tweed region
• Large showroom retailing continues to be in hot demand with household retail trading continuing to be active, keeping yields within the 5.5 per cent to 7.5 per cent range

Ray White Commercial (GC South) Sales and Leasing Specialists Darren Jones and Aaron Neylan said the Tweed region continued to excite.

Neylan said that Tweed had a vibrant growing population and strong tourism trade all aiding in local business and investment into the Shire.

“While traditional private investors have actively invested into the local economy, State investment into infrastructure has spurred on buyers from further afield looking to take advantage of competitive yields in this improving economy."

Mr Jones said that across the Tweed region the industrial market continued to be the most active of them all.

“The high level of smaller industrial holdings including industrial units has dominated sales activity over the past 12 months, representing $41.453M during the 2018/2019 period, up 28.59 per cent on the prior financial year,” he said.

“These smaller assets with an average price of $943,000 are well suited to the smaller local investor keen to capitalise on low interest rates and yields averaging sub 6.75 per cent.

“Retail assets continue to regularly trade but smaller strip retail assets are becoming increasingly more difficult to keep occupied with food and service-related tenancies most active in the current market

 “Larger showroom retailing continues to be in hot demand with household retail trading continuing to be active, keeping yields within the 5.5 per cent to 7.5 per cent range.”

Mr Neylan said the industrial market was the greatest space-user across the Tweed region and the range of stock was wide with a mixture of older-style factory warehouses and smaller, modern industrial unit complexes which offered a mix of office and retail uses.

“Current net face rents for industrial stock average $125 per square metre but they can range from as low as $70 per square metre up to $170 per square metre depending on its size, quality and access,” he said.

“Properties which offer a greater office component or more traditional commercial office space have shown stable rents over the last 12 months, currently averaging $208 per square metre, but these can range closer to $300 per square metre for quality stock.”

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