Hobart the apple of Colliers' eyes

COLLIERS International has opened a new office in Hobart in response to increasing demand from national clients with an interest in state.

The new business will focus on commercial, industrial, retail and rural property services.

Colliers’ Australia chief executive John Kenny said the new business take’s the company’s geographic spread to over 37 offices across Australia and New Zealand.

The Hobart business will be run by local property identities Justin Wilson, Mark Johnston and Tony Collidge, who have hold extensive experience in the Hobart property market.

Colliers’ commercial sales manager John Barwick said the commercial market in Hobart has experienced strong growth with strong demand in all sectors, in particular in the office sector.

“We estimate the local office market currently has close to 100% occupancy. Hobart is currently experiencing unprecedented new office block construction with four major developments proposed in the next 12 months, in addition to two new developments either completed or close to completion in the last 12 months.

“This demand has evolved as a result of new compliance standards combined with the growth of the State & Commonwealth Government office needs,” he added.

On the retail front, Barwick said prime retail space in the CBD is fully occupied, however there is some retail space available on the city fringe.

And in the local industrial sector, demand for warehouse/storage facilities is equally strong to meet transport industry needs, predominantly road freight transport into Hobart for distribution.

Trends in the warehouse/storage sector have seen new industrial land subdivisions in the outlying areas of Cambridge (on the eastern shore) and Bridgewater/Brighton (north of Hobart).

He added that Cambridge land parcels have achieved sales up to $200/sqm and is essentially sold out; its popularity due to the mix of bulky goods and warehouse properties and close proximity to the Hobart Airport.

Bridgewater land parcels have achieved rates of up to $100/sqm with a focus more on industrial users (light, medium & heavy) compared to the retail commercial use at Cambridge.

Meanwhile, Barwick said commercial yields have tightened over the last three years from an average 10% to 8%, with the local valuers using a yield of 8.5% as a general “rule of thumb”.

“Looking ahead, we expect to see continuing growth in all commercial sectors over the next three to five years, particularly in the industrial sector as the need for road freight transport services continues to grow in response to an ageing rail freight system.

“With cargo ships delivering more into Tasmania’s northern ports and less into the port of Hobart, which is experiencing major residential/tourist accommodation development, truck transport services, storage facilities and other associated industrial property will particularly be in strong demand,” he concluded.

Australian Property Journal