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A beginner’s guide to the Australia commercial property market

By Greg Bell

The commercial real estate market in Australia is one that presents a lot of great opportunities for investors – after all, it's booming and has been for some time now. However, just because the sector as a whole presents some fertile ground, that doesn't mean everyone is guaranteed success.

You will need a solid understanding of what's going on in the market and what you can do to capitalise. For instance, did you know that the biggest driver of the market overall is demand for office space in Sydney and Melbourne? According to Commercial Property 2 Sell, these two cities signify the twin capitals of the Australian commercial market. As such, it takes a real understanding of the commercial property landscape to truly take advantage of the opportunities available today.

What you need to know
When you're considering buying commercial property in Australia, you will have to think about what's available, what funds you have (or what you have combined with any partners you bring to the table), the demand for the kind of space you have in mind, interest rates and more – including state tax rates.

For instance, while office space might be highly in demand in a given city – good news for finding a tenant! – it would also be more expensive to acquire or build as a consequence.

Understand the shifts
Meanwhile, as certain types of commercial property rise to favour, some investors may be turning their backs on others that used to be more popular, such as retail and residential development, according to Real Commercial. However, those segments of commercial real estate may still present great opportunities in certain situations.

Given this reality, you will need to look at every property individually, using bigger trends as a guide. There are likely to be great retail properties that would be good investments despite waning demand for such space overall. Likewise, there could be office rental space opportunities that aren't particularly strong even if that portion of the sector is surging more broadly.

It's always a good idea to work with an experienced commercial real estate agent before making any hard and fast financial decisions, and at Ray White Surfers Paradise, we're here to help. Give us a call today to talk about your goals and start down the path of finding a workable investment strategy based on what's available.

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