Scott O'Neill
speaker
1,140 appearances
15 recordings
2 series
first heard Jan 2022
last heard 12 May
Scott O'Neill’s voice in public audio — every appearance, attributed to the second.
Trend
recordings per month · last 12 monthsRecordings per month over the last 12 months — 1 in all, peaking in May 2026 with 1.
Appearances
basically the logistics sector is redlining and it's causing the lowest ever vacancy rates in the industrial market history.
And that's causing rents to grow very quick in the industrial space.
And investors are loving that, not only because we're seeing fast growth rates in industrial rents,
But it also implies a certain layer of security because if you know you're going to find a tenant quick because the vacancy rate's tight, then that's going to make you feel more comfortable with the asset and investors are going to be more likely to purchase it in that case, which actually increases the demand on the sales side of things.
Yeah, again, it's going to apply different to different asset classes.
So industrial property won't really be as concerned with gentrification as retail would be.
An example, let's say the average income of an area grows.
You might see more working class type retail shops like news agencies or certain types of restaurants get phased out and they might be replaced with gyms or bars or
or dentists, basically higher end retail.
And that actually is another form of capital growth because the higher the quality of the tenant or the perception of the quality of tenant to investor, the more they'll pay.
Also higher quality tenants will tend to pay more per square meter.
Main reason for that is just extra dollars they spend on fit-out and they've got the ability to spend more because they really want to be in an area.
It's a long-term capital growth factor.
But if you know a market is improving for various reasons, it could be because they're knocking old units down and replacing them with luxury ones and there's various other...
factors that cause gentrification.
But commercial markets are the hub of the community in those areas.
So they are directly going to benefit from any type of residential gentrification in the area.
And if anything, they're almost the first to benefit from it.
Yeah, that's right.
So as the rent grows, basically how you calculate the value of a commercial property is its annual rent divided by the market's cap rate.
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