Commercial and Industrial Property Portfolio Q1 2024

Welcome to the Q1 edition of the 2024 Commercial Collection, where we highlight the latest range of commercial and industrial property opportunities available with Commercial Collective.

Last year, the sales of Health and Aged Care & Retirement facilities demonstrated exceptional growth for Commercial Collective, exceeding a noteworthy milestone of $250 million. This is very much in line with the Health and Age Care market as a whole, where divestments are creating new opportunities for expansion and entry into the market. This is due to a market segment that has seen a large shortage of stock on the market and increased operating costs due to government regulation changes. According to a recent report by the Productivity Commission, there is a growing concern over the decline in available beds in NSW, with a population increase in the over 80 age bracket of 12,500 each year and only 4,322 additional beds being created. This suggests the potential for large growth in the market in coming years.

The Industrial market is continuing to experience a significant increase in demand for both A and B Grade investment assets, providing a highly engaging landscape of opportunities for investors. A Grade assets yield a steady return of 5.75% to 6.5%, while B Grade properties offer slightly higher returns ranging from 6.5% to 7%. This paints a clear picture of a market in high demand and presents a promising investment prospect for those looking to capitalise on this trend.

The Commercial market has seen a significant influx of investment assets, spanning both A and B Grades. The promise of additional stock entering the market this year aligns seamlessly with a growing demand for environmentally sustainable and highly rated ESG buildings, reflecting an industry that is prepared for evolving priorities.
Retail premises have been in lesser demand following the impact of Covid 19 but Newcastle has not experienced the same decline in demand that was seen in larger cities like Sydney and Melbourne. Commercial retail located within the Newcastle city CBD, Maitland city, and areas close to shopping complexes such as Kotara, Charlestown, and East Maitland are continuing to provide investors with great alternatives.

Newcastle’s high level of investment in infrastructure and development over the past seven years and strong population growth have only bolstered its reputation in the market and attracted new investment in the region.

The promise of increased stock, sustainability initiatives, and the adaptability of local businesses collectively set the stage for a dynamic market environment. Investors and businesses that can stay agile, monitoring market shifts and adapting strategies to leverage emerging opportunities are likely to perform best in this market climate.

Speak with our sales and leasing team today to learn more about the opportunities in this quarter’s Commercial Collection.