The development of new service stations will jump by 272 per cent this year with 186 projects due to be completed across the country, according to new figures by CBRE.
However, as the use of electric cars grows and revenue and profitability start to decline, development is expected to start tapering off in 2020 and 2021.
Over the next three years, almost 400 new service stations are due to be completed and a third of these will be in Queensland, a state bettered only by the Northern Territory in its lack of investment in renewable energy.
According to the Climate Council, Queensland derived only 7.1 per cent of its energy needs from renewables in 2017 compared with 13.6 per cent in Victoria and 12.6 per cent in NSW.
NSW and Victoria will account for a fifth each of the new service station supply to hit the market over the next three years, according to CBRE’s 2019 Service Station Market Review.
The report expects a plethora of negative factors to affect the sector, including falling profit margins and revenues, declining demand for petrol, a moderation in the growth of vehicle ownership and the growth of the electric car segment.
However, private investors continue to favour service station investments, which typically come with long leases to the likes of Wesfarmers (Coles Express), Woolworths, BP, Caltex, 7-Eleven and United.
Extracted from AFR