RBA Leaves Rates on Hold – What It Means for Commercial Property Investors

The Reserve Bank of Australia (RBA) has decided to keep the cash rate steady at 4.35%, offering a stabilising force for the commercial property market. At MCommercial, we see this as a significant opportunity for investors seeking certainty in a shifting economic landscape. With interest rates holding firm, commercial property buyers can plan with greater confidence, benefiting from more predictable financing costs—an advantage for those looking to expand or diversify their portfolios.

Demand for Commercial Real Estate Remains Strong

Leasing demand for high-quality commercial property continues to grow, driven by strong population growth and rising business activity. According to ABS data, Australia recorded 548,000 permanent and long-term arrivals in the year leading to December 2023—one of the highest migration figures on record. This surge is increasing demand across multiple commercial property sectors:

• Industrial & Logistics: Businesses require more warehousing and distribution space to support rising consumer demand.

• Retail: Population growth is fueling retail expansion, increasing the need for well-located commercial retail spaces.

• Office: Prime office locations in key markets like Brisbane, Sydney, and Melbourne are experiencing renewed demand, particularly for high-quality, modern office spaces.
  

Supply Constraints Are Driving Rental Growth

While demand is rising, the supply of premium commercial properties remains tight. Several factors are contributing to this scarcity:

• High construction costs and elevated interest rates are slowing new developments.

• Labour shortages and strict planning regulations are delaying commercial property projects.

• Low vacancy rates, particularly in the Industrial & Logistics sector, are driving up rents.

Nationally, industrial rental prices have surged by 18% over the past year, and CBD office spaces and retail properties are seeing similar upward trends—especially in key markets like Brisbane’s CBD, where rents have risen significantly.

How Investors Can Capitalise on the Market

These supply challenges create a strong investment opportunity for commercial property investors looking to benefit from:

✔️ Rising rental yields due to increasing demand and limited supply. ✔️ Capital growth potential as high-quality assets become scarcer. ✔️ Long-term stability with tenants willing to pay a premium for well-located properties.

At MCommercial, we specialise in sourcing high-performing commercial assets that offer exceptional long-term value. Our deep market knowledge and strategic approach help clients navigate market fluctuations while securing investments that align with their financial goals.

Now Is the Time to Invest

With the cash rate holding steady, now is the time to position yourself for success in the commercial property market. Whether you're a first-time commercial investor or an experienced buyer looking to expand your portfolio, we’re here to help you secure the right opportunities at the right time.

Book a call with us today to discuss your investment goals and explore the best commercial property opportunities in Australia.