A recent study conducted by real estate firm CBRE indicates a notable surge of 113 per cent in Australia’s e-commerce industry from 2017 to 2022, reaching a significant US $ 53 billion milestone. Titled Australia’s E-Commerce in the Post-Pandemic Era, the report outlines a remarkable growth trajectory, highlighting a peak of 15 per cent surge in online retail trade in April 2022, which then moderated to a three-year low of 12.6 per cent by March 2023. Despite this decline, the sector has stabilised at a growth rate considerably higher than the average annual growth of 2.5 per cent observed from 2017 to 2021.
Sass J-Baleh, CBRE’s Australian head of industrial and logistics research, emphasised the number of online consumers, noting an increase from 73 per cent in 2018 to 82 per cent of Australian households making online purchases in 2022. He remarked, “These consumers, formerly new to online shopping, have developed a sustained preference for this mode of commerce, a phenomenon arising from the pandemic’s impact.”
J-Baleh also highlighted the accelerated e-commerce adoption in burgeoning markets like Canada, Spain, Poland, Italy, Portugal, and Turkey, drawing parallels to a similar trend observed in the United States, where the e-commerce penetration rate currently exceeds its pre-COVID trajectory by three years.
The report forecasts a demand for an additional 1.1 million square meters of logistics space dedicated to e-commerce over the next four years in Australia. J-Baleh emphasised the necessity to unlock alternative spaces or intensify the utilisation of existing ones, citing the trend of developing multi-story warehouses in the Sydney market to meet this escalating demand.
According to CBRE’s insights, approximately 850,000 square meters of multi-story space across 20 projects in Sydney are expected to be developed between 2023 and 2027, particularly noteworthy as Sydney holds the country’s highest rental rates. Nathan Egan, CBRE’s South Sydney managing director, highlighted the urgency for proximity to consumers for swift deliveries in urban areas, proposing multi-story warehouses as a solution to land constraints and rising costs in urban spaces.