'Boutique industrial' is the next trend in commercial property development

The trend follows the swing toward premium office space, driven by the investor-led flight to quality. These ultra-modern and plush complexes come with all the extras, such as cafes, yoga rooms, meeting rooms equipped with audio and visual technology, and all in prime locations near public transport or road networks.

Jared Johnson, director of Coastal Commercial, said the shift to swanky factories was long overdue.

“I’ve found commercial is behind the eight-ball in everything from marketing to buyer experience,” he said.

“It’s no longer about putting up a slap-dash building and putting it on the market.”

Johnson and a business partner are developing eight industrial units called Basalt Lane in Tweed Heads South. Sized between 143 square metres and 194 square metres, two have already sold, and the remaining six are priced between $995,000 and $1.425 million.

Each includes luxury features, such as balconies and cascading gardens.

But it’s not just fixtures and fittings; industrial developers are also competing for investors on the amenities front.

In Queensland’s Park Ridge, the Granvia development includes 18 architect-designed industrial units, each with a shower and a kitchenette, serviced by an on-site cafe.

“We’ve seen a trend of industrial property becoming more popular since COVID, specifically in Brisbane,” said Ben Sands, a director at McGrath Beenleigh.

“We have seen a trend to people wanting higher spec warehouses, there have been good, successful complexes sold off the plan in that way.

“I feel that people live in small houses these days and there’s not a lot of space, whether that’s for their businesses or their toys sometimes. These business owners can be local trades people or e-commerce, anyone who needs storage and a couple of people working out of an office.”

Attractive rental yields from industrial real estate have attracted investors, not just in inner-city areas. Suburban warehouses are also being built with upscale design, with common features including floor-to-ceiling windows – not just a roller door and small windows – and mezzanine offices instead of small walled-off spaces near the front door.

At Gawler Belt, 50 kilometres from Adelaide, 30 units are being designed bespoke for tradies and e-commerce operators, among others.

“They’re not just sheds anymore, you could almost live in them now,” said Chet Al, Knight Frank partner and head of investment sales – capital markets.

“I’ve bought a few myself purely because the aesthetic factors to a tenant are more appealing.

“When you go to lease them out, they do make it easier to lease. People want to touch and feel, and when they have clients come to the site, they want to have that wow factor.