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Multi-Level Warehousing

From scarcity to scale: Multi-level warehousing is the answer to land constraints.

Demand for central warehouse space has risen sharply over the past five years, driven by e-commerce and the need to position stock closer to customers to reduce transport costs, which typically account for around 60% of total supply chain costs.

However, scarcity of infill industrial land has made it increasingly difficult for occupiers to secure suitable sites. In response, multi-level warehouses are emerging as an innovative solution, providing premium leasing opportunities in Sydney’s core markets.

While multi-level in Australia remains nascent, its continued rollout through a large supply pipeline will reshape investment strategies and influence how occupiers make location and leasing decisions.

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Key Topics

  • Global perspective: Multi-level warehousing in other markets and key learnings for Australia
  • Occupier benefits: Why multi-level warehousing works in infill markets and driving forces
  • What next? How large is the pipeline, who’s delivering it, and what are the design trends

Podcast Series


Introduction: Multi-Level Warehousing Series

The introduction episode provides an overview of the series, highlighting why multi-level warehousing matters and what insights to expect. Across the series, we speak with industry leaders to explore evolving warehouse design, emerging projects and the future of logistics real estate in Australia.


Episode 1: AXA Investment Managers

Host: Luke Crawford, Head of L&I Research, Cushman & Wakefield  
Guest: Thomas Karmann, Global Head of Logisitics, AXA Investment Managers

This podcast explores the multi-level warehouse sector in Australia, featuring insights from Thomas Karmann, Global Head of Logistics at AXA Investment Managers. The discussion covers the global perspective on multi-level warehousing, the challenges and opportunities in different regions, tenant preferences, and advice for developers in Australia.

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Thomas Karmann, Global Head of Logistics

Thomas Karmann is the Global Head of Logistics at AXA IM, where he leads the firm’s global logistics investment strategy, overseeing acquisitions, developments and asset management across key logistics and industrial markets. With nearly three decades of experience in the sector, he has held senior leadership roles at Prologis, Gazeley, GSE, and Bouygues, bringing deep expertise in portfolio growth, supply chain real estate, and sustainable asset development.


Episode 2: Hale Capital Partners

Host: Luke Crawford, Head of L&I Research, Cushman & Wakefield
Guests: Kenji Fukuda, Head of Development, Hale Capital Partners
Alana Garrick, Senior Development Manager, Hale Capital Partners

This podcast episode discusses the evolution of multi-level warehousing in Australia, featuring insights from Kenji Fukuda and Alana Garrick of Hale Capital Partners . They explore the rationale behind multi-level warehousing, site selection criteria, operational efficiency, tenant feedback, cost benefits, and the future of this trend in the Australian market.

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Kenji Fukuda, Head of Development

Kenji Fukuda is the Head of Development at Hale Capital Partners, bringing over 20 years of experience in the industrial real estate sector. He has previously held senior roles at LOGOS, Frasers Property Industrial (formerly Australand), and ESR Australia (formerly Commercial & Industrial Property).

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Alana Garrick, Senior Development Manager, Hale Capital Partners

Alana Garrick is a Senior Development Manager at Hale Capital Partners, where she plays a key role in managing and delivering multi-level warehouse projects. She has been involved in projects such as the proposed multi-level warehouse and distribution centre development at 42 Raymond Avenue, Matraville.


Episode 3: Australian Tenant Advisory

Host: Luke Crawford, Head of L&I Research, Cushman & Wakefield
Guest: Morgan Evans, National Director, Tenant Advisory Logistics & Industrial, Cushman & Wakefield

This podcast explores the evolving landscape of multi-level warehousing in Australia, focusing on its benefits, challenges, and future trends. Luke Crawford and Morgan Evans discuss the increasing demand for vertical warehousing solutions driven by land scarcity, last mile logistics, and the need for sustainable practices. They delve into the advantages of multi-level facilities, including lower operating costs and proximity to urban centers, while also addressing the challenges tenants face, such as fit-out costs and regulatory hurdles. The conversation concludes with insights on the future growth of this sector across major Australian cities.

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Morgan Evans, National Director, Tenant Advisory Logistics & Industrial

Morgan has over 10 years of experience in real estate, specialising in representing industrial occupiers. He leads Cushman & Wakefield’s Industrial Occupier team nationally and has become a trusted advisor to numerous corporate clients across Australia. Recognised as one of the industry’s leading industrial advisors, Morgan leverages his market knowledge and expertise in managing competitive procurement processes to deliver consistently strong outcomes for his occupier clients.


Episode 4: Mapletree Investments

Host: Luke Crawford, Head of L&I Research, Cushman & Wakefield  
Guest: Kent Williams, Mapletree Investments

In our latest podcast, Luke Crawford and Kent Williams from Mapletree discuss the evolving landscape of multi-level warehousing in Australia, drawing comparisons with established practices in Asia. They explore the factors driving the adoption of multi-level warehouses including land scarcity and urbanisation as well as the design and operational differences between regions. Kent shares insights on tenant feedback, the importance of flexibility in design and the role of sustainability in development.

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Kent Williams, Head, Group Development Management, Australia/India/Europe & UK/US, Mapletree Investments

Kent Williams has 28 years of experience in construction and real estate development. In his role in Mapletree, he leads teams executing real estate development and asset enhancement projects in Australia, India, the United Kingdom, Europe, and the United States across commercial, logistics, industrial and student accommodation properties. To date, he has completed projects in Mapletree that total more than 10 million square feet.

Notable completed projects at Mapletree include:

  • Phase 2 expansion of Mapletree Business City, a 1.3 Million ft2 Business Park development at Alexandra precinct, Singapore
  • 800,000 ft2 Build to Suit facility for Hewlett Packard at Depot Road, Singapore
  • 450,000 ft2 Office / Industrial space with Retail and underground connection to MRT station at 18 Tai Seng, Singapore
  • 340,000 ft2 speculative High Tech Industrial building at Kallang, Singapore
  • 230,000 ft2 Build to Suit Data Center, Singapore
  • Upgrading and enhancement projects to existing Assets such as Vivocity and HarbourFront Center
  • Conversion of St. James Power Station, a preserved monument, to a 150,000 ft2 Commercial Office HQ.
  • 280,000 ft2 speculative Commercial Office development at Green Park, Reading, UK
  • 2.1 million ft2 Logistics Park, Logan, Queensland
  • 1.2 million ft2 4 storey ramp up warehouse, Fukuoka, Japan
  • 1.8 million ft2 IT / Commercial Park comprising of 3 blocks of 14 storeys, Pune, India
  • 1.1 million ft2 Logistics Park, Bangalore, India

KEY SECTOR TRENDS


1

DIVERSE OCCUPIER MIX SUPPORTS DEMAND

Unlike the global occupier mix, Australia’s current multi-level projects are skewed towards manufacturers, driven by Schindler Lifts’ commitment at Charter Hall’s Accent on Bourke (10,174 sqm) and the more recent commitment of Infrabuild at Hale’s Platform project at Milperra.

Over time, the occupier profile is expected to shift towards retailers and logistics operators, mirroring the global trend. 

2

INFILL MARKETS PROVIDE THE OPPORTUNITY TO LOWER COSTS

As occupiers focus on reducing supply-chain expenses, central warehouse locations have become increasingly sought after.

While real estate occupancy accounts for just 10–15% of total operational costs, locating closer to customers can significantly reduce transport spend, which is the single largest cost component. Even with higher rents in infill areas, occupiers can achieve meaningful overall savings, with multi-level facilities providing the added benefit of lower outgoing costs. 

3

WHY IT WORKS?

The viability of multi-level development depends on whether higher construction costs can be offset by rental rates and the additional occupiable space created. This is critical, as building a multi-level facility can cost more than twice that of a traditional single-level warehouse on a per sqm basis.

Economies of scale also play a role. Sites typically need to exceed two hectares to achieve sufficient efficiency, as some floorspace is lost to ramps and circulation. Global experience shows that larger sites are necessary to deliver commercially viable outcomes. 

4

TENANT VALUE PROPOSITION STEMS FROM LOWER OUTGOINGS

A key advantage of multi-level warehousing is its ability to reduce outgoing costs . Since land taxes and council rates typically account for 60–75% of total outgoings, these costs are effectively diluted across a larger building footprint.

Current multi-level facilities record outgoings at roughly half those of comparable single-level assets, leading to a notable reduction in total occupancy costs. This lower gross occupancy cost provides greater headroom for rental growth, as occupiers increasingly recognise and price in the long-term cost advantages of multi-level formats. 

5

MULTI-LEVEL PIPELINE IS GROWING

To date, there have been approximately 110,000 sqm of multi-level warehouse space delivered in Sydney, the majority of which has been within the South Sydney market. 

Over the next two years, a further ~180,000 sqm of multi-level warehouse space will be added to the market, while there is potential for a further 1.4 million sqm in the longer-term pipeline. 

Why this matters

Australia’s logistics market is entering a new phase where space efficiency, cost control, and proximity are shaping every occupier decision. Multi-level warehousing represents a strategic evolution, enabling occupiers to stay close to customers, reduce total supply chain costs, and unlock greater value from scarce urban land.

For developers and investors, rising replacement costs, constrained land supply, and growing occupier acceptance are creating the conditions for long-term rental growth and market maturity. The shift upward marks a structural turning point in how Australia builds, invests, and competes in the modern logistics landscape.

Contacts

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Luke Crawford

Head of Logistics & Industrial Research
Australia

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Tony Iuliano

International Director, Head of Logistics & Industrial, ANZ
Sydney, Australia

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David Hall

National Director, Head of Brokerage, Logistics & Industrial, ANZ
Sydney, Australia

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