Australia’s industrial and logistics sector is heading into a defining year. After cycles of rent spikes, construction swings and shifting occupier needs, 2026 is emerging as a pivotal moment. One where clarity returns and strategy takes the lead.
Drawing on insights from Cushman & Wakefield, Knight Frank and CBRE, we’ve pulled together the seven trends that will set the pace and opportunities for the year ahead.
1. Leasing demand will improve as certainty returns
After a cautious 2025, occupiers are getting active again. Business sentiment is lifting, enquiries are up, and there’s finally more clarity around what’s available – and what’s worth chasing.
The fundamentals haven’t changed. E-commerce, 3PLs, data centres and urban logistics are still fuelling demand across the Eastern Seaboard, where well-located space remains hard to come by.
And with consumer spending bouncing back from last year’s lows, transport and logistics operators are more confident about making leasing decisions again. Nationally, we’re looking at close to 2 million square metres of space being leased in 2026. That’s a big jump from the quiet year we’ve just had.
2. Flight to quality will take centre stage
Almost 70% of all 2025 leased floorspace has been prime-grade – which is well above the long-term average. This tells us occupiers aren’t just upgrading for the sake of it. They’re choosing smarter buildings that can help them boost efficiency, cut costs and future-proof supply chains.
The tightest competition is in Sydney and Melbourne’s prime infill precincts. So when something good hits the market in these pockets – where space is scarce and every operational advantage counts – it moves fast.
And as land becomes harder to secure across the Eastern Seaboard, businesses are looking for facilities that give them more. This means automation-ready warehouses, specialised layouts and energy-efficient upgrades are becoming must-haves, not nice-to-haves.
A sector to watch? Cold storage.
Large corporates are upgrading fast, because older facilities no longer meet today’s energy efficiency and sustainability standards. And with new and refurbished spaces struggling to keep up with demand, upgraded cold storage is now achieving $350+ per sqm net – a clear sign of just how strong demand is.
3. Tight supply will push more projects into pre-commitments
With land prices still high and construction costs sticking around, developers are thinking twice about which projects to kick off – and which ones to delay.
The numbers say it all:
- Nearly 900,000 sqm of planned supply has already been pushed past 2027.
- Another 2.4 million sqm won’t move unless pre-commitments are locked in.
- Only two-thirds of the 2026 pipeline is actually underway or pre-leased.
It’s no surprise then that most new buildings in 2026 will be pre-committed or build-to-suit – projects designed around tenants from day one, rather than speculative builds hoping to find a tenant later.
We’ll also see more activity shift to the outer precincts, including Melbourne’s West and North and Sydney’s Outer West as that’s where the limited developable industrial land is located.
4. Vacancy will peak (briefly) before falling again
Vacancy is expected to hit its high point in early to mid-2026 – just under 4% – before tightening again as new supply slows. So yes, there’ll be a little more choice in the short term. But it won’t last long.
Importantly, that choice won’t be evenly spread. Areas that have delivered a lot of new stock, especially outer-ring estates, will take longer to rebalance.
On the other hand, established infill markets – like Sydney’s South, Melbourne’s South East and East, and Brisbane’s Trade Coast and Inner North – should hold their ground, thanks to tighter supply and steady demand.
5. Rental growth will split into two speeds
The days of across-the-board rent jumps are behind us. In 2026, rental growth will move at two speeds, with some precincts pulling ahead and others easing off.
In short, expect the gap between the strongest and weakest precincts to stretch up to 10% over the next five years.
Here’s what’s driving the split:
- Incentives will peak in 2026, giving occupiers a short window to secure sharper deals before they tighten again.
- Tight, established infill locations will continue to outperform, while newer estates work through their recent wave of supply.
And for tenants still on pre-2021 leases: renewing or relocating will mean steeper rent increases – simply because the market has shifted so significantly.
6. Investors will double down on industrial
Industrial is still the sector investors trust most. And its steady income and long-term demand are drawing more capital back into the market.
Even as retail and office become more competitively priced, offshore investors are still targeting Australian logistics, showing just how resilient the sector is.
A few big themes are shaping 2026:
- Interest is spreading beyond Melbourne and Sydney to Brisbane and Adelaide.
- Appetite is strong for data centres, cold storage and automation-ready facilities.
- Investors are sharpening their focus on rent reversion in well-located, undersupplied infill markets.
In short, investors will put their money where demand is strongest and supply is tightest.
7. On-shoring will move from ambition to action
After years of talk, on-shoring is finally expected to gain real traction in 2026. A mix of policy support, global trade uncertainty and election-driven geopolitics is pushing more businesses to rethink what they produce locally – and why.
The sectors most likely to lead the shift include:
- Advanced manufacturing
- Green energy
- Critical technologies
- Meditech, life sciences and defence industries
Federal incentives like the $15 billion National Reconstruction Fund are also giving companies a stronger reason to invest onshore.
What does this mean? As local production ramps up, we’ll see growing demand for high-spec, automated and energy-efficient industrial facilities.
BONUS trend: Industrial outdoor storage (IOS) will grow up
IOS is already moving from a stopgap solution to a fully-fledged investment class. And that trend is only set to grow in 2026.
Sites that were once held for future development are now being repurposed into secure, high-load, tech-enabled storage spaces – from container yards to vehicle storage to transitional infrastructure.
Tenants are willing to pay for power, connectivity and site upgrades. And investors are taking notice, viewing IOS as a strategic, flexible and resilient option in land-tight markets.
Put simply, IOS is maturing into a smart, scalable asset class of its own – one that will continue to support industrial growth well beyond 2026.
2026 is the moment to think sharper and move smarter. And for women in industrial and logistics, it means more room to lead, influence and drive change.
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