Top four challenges in industrial property & equipment management

Managing industrial properties comes with a unique set of challenges, particularly in a market that has faced economic uncertainties in recent years. Like the broader commercial property sector, industrial real estate has felt the impact of high inflation and rising interest rates, creating financial pressures for property owners and occupiers alike. However, with economic conditions expected to improve in 2025 and business and consumer confidence on the rise, the industrial market is poised for growth.

As industrial occupiers transition into more favourable market conditions, now is the time to address the key challenges associated with managing industrial property and equipment.

Below, I explore the four top challenges in managing industrial property and equipment, along with the software and solutions that can help overcome them.

Challenge 1: Complex property and equipment leases

Industrial leases often involve intricate terms and tenant obligations, such as maintenance responsibilities, escalating rent clauses, and specific usage requirements. It is widely acknowledged that many organisations still rely on manual methods, such as Excel spreadsheets and disparate tools, to manage these complexities. However, these outdated approaches increase the risk of errors, missed deadlines, and inefficiencies, leading to financial and operational challenges.

Solution: Implementing lease management software provides property professionals with a complete overview of all property and equipment leases. These tools automate critical task notifications, ensuring that key dates, clauses, and obligations are never missed. By moving away from spreadsheets and adopting a purpose-built solution, organisations can reduce administrative burdens, improve accuracy, and gain better control over their lease portfolios.

Challenge 2: Maintenance and asset management

Unexpected equipment downtime is a major challenge in the industrial sector, leading to halted operations and costly repairs. A 2023 survey by ABB found that 69% of Australian industrial businesses experience unplanned outages at least once a month, with each hour of downtime costing approximately AUD 349,000. With aging equipment being a leading cause of disruptions, effective maintenance strategies are essential to avoid financial losses and operational inefficiencies.

Solution: Facilities management software helps mitigate these challenges by enabling proactive maintenance scheduling, asset tracking, and lifecycle monitoring. These tools ensure businesses can monitor equipment health, schedule timely maintenance, and reduce unexpected failures. By automating maintenance tasks and tracking inventory levels, organisations can improve efficiency, extend asset lifespan, and significantly cut downtime-related costs.

Challenge 3: Lease compliance

Complying with lease accounting standards such as IFRS 16 can be complex, particularly for industrial occupiers managing multiple sites, long-term leases, and high-value assets. Failure to track and report leases accurately can lead to financial misstatements and regulatory penalties.

Solution: Lease accounting software ensures businesses remain compliant by automating lease calculations, centralising lease data, and generating accurate financial reports in line with IFRS 16 and other accounting standards. These solutions also streamline audits, reduce manual errors, and provide visibility into lease liabilities, helping businesses maintain financial accuracy and compliance.

Challenge 4: Energy and sustainability goals

As new mandatory sustainability reporting requirements are phased in, there is increasing demand from industrial tenants for newer, more energy-efficient buildings. However, simply upgrading to energy-efficient buildings is not enough.

The industrial sector, known for its energy-intensive operations, is a significant contributor to operational carbon emissions. While policies like the Safeguard Mechanism are in place to regulate emissions, the need to measure, manage costs and meet sustainability targets is essential.

Achieving sustainability targets requires a comprehensive approach to reducing energy use, manage costs effectively, and meet long-term environmental goals.

Solution: The NABERS Energy for Warehouses and Cold Stores rating tool, launched in 2022, helps owners and operators benchmark and improve energy efficiency. By obtaining a NABERS rating, businesses can identify inefficiencies, implement energy-saving measures, and track sustainability progress.

Complementing this, energy management software provides real-time monitoring, highlights inefficiencies, and offers actionable insights to reduce consumption and costs. Together, these tools support regulatory compliance, enhance efficiency, and drive long-term sustainability.

Unlock operational efficiency with advanced property management solutions

Managing complex industrial property and equipment leases doesn’t have to be a struggle. With the right tools in place, organisations can improve efficiency, minimise risks, and stay compliant with ease. MRI Software offers a comprehensive suite of solutions designed to simplify industrial lease management, streamline operations, and provide actionable insights for better decision-making. Contact us today to learn more.