Office Assets The Most Transacted

After a difficult few year’s demand for office assets is returning, with the sector making up the largest portion of commercial transactions in the last financial year, according to Ray White Commercial.

Despite uncertainties surrounding the office market due to remote work trends, office spaces made up 27.7% of all transactions and have shown improvement compared to the previous year, where they accounted for a quarter of all sales.

At the same time, industrial properties continue to be in demand. However, their proportion of investment has decreased to 23.5% this year from 27.7% in the previous year. Strong occupier demand, especially for larger distribution and logistics facilities, has kept vacancies limited and rental growth positive. Limited new supply and land constraints have led to owners being cautious about bringing assets to market despite this growing demand.

Retail properties: Retail assets’ share of transactions has declined from 22.6% to 17.1% in the last year, mostly influenced by larger regional transactions in the previous year. However, demand for smaller neighbourhood or convenience-based retail spaces has remained steady among a range of buyers, while investments into retail strips have slowed.

The alternative property sector has seen significant growth in interest from various buyers across different uses. Assets like service stations experienced a peak in 2020, but other areas such as childcare and healthcare/medical spaces have continued to gain popularity.

Meanwhile, development site activity has seen growth after a period of relative quietness due to lockdowns and construction disruptions. Investments in various development types, particularly in areas with low vacancy levels like residential and industrial, have gained momentum.