Perth, July 31: New research shows the Perth industrial market is poised for a period of sustained growth, with the widening supply and demand imbalance set to propel Perth to the global investment peak. According to property and investment fund manager Realside, the outlook effectively dispels any notion that Perth is a ‘boom and bust’ market.
Cushman & Wakefield’s Perth Market Overview: Logistics & Industrial June 2026 forecasts Perth’s long-term outperformance in all key industrial metrics — investment yields, rental growth, increasing demand, declining vacancy, and rising land values.
The core dynamic is Perth’s severely constrained industrial supply which, when set against Western Australia’s nation-leading economic and population growth, points to sustainable long-term industrial growth in both an Australian and international context.
“Perth’s supply pipeline remains constrained by limited serviced industrial land, environmental constraints, infrastructure servicing bottlenecks, and development feasibility challenges including higher construction and funding costs. This means tenants have few alternatives, supporting lease renewals and sustained rental growth,” says Realside CEO Linda Rudd.
“At the same time, strong demand from the state’s growing economy and population is set against this structurally weak supply, and this demand is not cyclical. More people means stronger demand for consumer goods, logistics, transport and storage infrastructure over the long-term. Industrial property performs best where economic activity and business formation are strongest, and Western Australia leads the country on both counts. This sustained growth outlook puts the ‘boom and bust’ notion of the West Australian market to bed, for good,” Rudd said.
The Cushman & Wakefield report notes that industrial supply constraints could potentially be exacerbated by industrial land acquisitions linked to AUKUS projects, emphasising that AUKUS is not a short-term cycle but a decades-long industrial demand catalyst.
The report highlights more than $25 billion of investment and approximately 10,000 jobs linked to defence and submarine sustainment activities attached to AUKUS.
Cushman & Wakefield Head of Logistics and Industrial Research Luke Crawford said the underlying drivers of Perth’s industrial market have broadened considerably over recent years. “While the resources sector remains an important contributor, demand is increasingly being supported by nation-leading population and economic growth, major infrastructure investment and emerging sectors including defence and critical minerals. Combined with a structurally constrained supply pipeline, these factors provide a strong backdrop for the continued outperformance of Perth’s industrial market,” Crawford said.
Perth’s headline industrial vacancy rate of 2.7% is distorted by sub-lease availability and by excluding this space, the vacancy rate falls to 1.9%. A sub-2% vacancy rate places Perth among the tightest industrial markets in the world and this is forecast to tighten to 0.7% by 2028.
“Perth recorded annual prime rental growth of approximately 5.1%, the strongest industrial rental growth nationally and well above the national average. Effective rental growth has been even stronger as incentives have compressed,” Rudd said. “With prime rental growth of approximately 4.3% in 2026, despite already elevated rents the strongest years for Perth industrial are ahead of us,” Rudd said.
The West Australian economy has grown almost 30% since 2020 to outperform every other state, and Cushman & Wakefield expects this to continue over the next decade due to population growth, resources, energy and the proximity to Asia-Pacific growth markets. As Australia’s fastest-growing state, population growth alone will create demand for approximately 2 million sqm of additional warehouse space over the next decade, the report shows.
Perth’s investment edge over east coast markets is also reflected in yield, with prime Perth industrial yields averaging around 6.0%, approximately 50 basis points higher than east coast markets. “Perth remains one of the few Australian industrial markets that still provides a positive carry over debt costs. Investors receive both higher starting income and stronger rental growth prospects, a combination increasingly difficult to find nationally,” Rudd said.
Realside recently launched the recapitalisation of its Realside Ovest Industrial Core Fund No. 1, which is targeting a total return of 14.5.0% per annum over a five-year investment term and a target average cash distribution of 7.55% per annum. The Fund comprises a high yielding, fully-developed and fully-leased portfolio of six industrial assets in Perth with a total valuation of $183.5 million and tenants including ARC Group, Elders, Mader Group, Bestbar and Rubbergem.
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