Commercial Property Market Update – Mid 2025

Market Overview | Resilient, Stable and Poised for Growth

The commercial property market in Newcastle NSW continues to demonstrate resilience and adaptability in 2025. As national economic conditions evolve and workplace dynamics shift, Newcastle is emerging as a strategic hub for both investors and tenants seeking long-term value and operational flexibility.

Leasing Market Trends

Leasing activity in Newcastle has seen a notable resurgence, particularly in the city fringe areas. Office spaces ranging from 150-300sqm are in high demand, driven by agile businesses prioritising accessibility and flexible lease terms. This trend reflects a broader shift towards decentralised work environments, where proximity to the CBD is balanced with cost-efficiency and convenience.

Larger A Grade office spaces over 500sqm are also attracting increased interest, especially from corporate occupiers whose central leases are nearing expiry. Businesses relocating from outer metro areas are eyeing Newcastle as a viable alternative, drawn by its infrastructure, talent pool, and lifestyle appeal. Notably, there has been a rise in enquiries from Sydney-based tenants exploring expansion or relocation opportunities in the region, further fuelling leasing momentum.

Sale Market Insights

Investor sentiment in Newcastle’s commercial property sector has pivoted towards stability and income reliability. The current preference is for passive, low-maintenance assets secured by long-term leases to reputable tenants. These ‘set-and-forget’ investments are particularly attractive in a market where predictability and minimal capital outlay are key decision drivers.

While appetite for value-add or redevelopment opportunities has softened, there remains strong interest in properties offering structured rental growth. Investors are increasingly focused on lease fundamentals and long-term performance rather than speculative repositioning plays.

Newcastle Overview

Newcastle’s commercial property market benefits from its strategic location, strong infrastructure, and growing economic base. As regional centres gain prominence in national investment strategies, Newcastle stands out for its blend of urban convenience and regional affordability. The city’s ongoing transformation, driven by public and private sector investment continues to enhance its appeal to both occupiers and investors.

The Newcastle commercial property market is well-positioned for continued growth in 2025. With strong leasing activity, a shift towards stable investment assets, and increasing interest from metropolitan tenants, the region offers compelling opportunities for stakeholders across the property spectrum.

If you're looking to capitalise on Newcastle’s commercial market, whether you're an investor, developer or occupier, now is the time to explore opportunities in one of Australia’s fastest-growing markets. Get in touch to discuss how we can help you secure your next industrial asset.