Australia’s commercial property sector expected to flourish in 2022

Industrial and office rent collection improved steadily during 2021, peaking at 87 percent on many occasions

Data based on Momentum Wealth’s 2022 Property Sentiment Report showed that three out of five (59 percent) respondents said they were interested in investing in commercial property, according to Business News. Twelve percent, on the other hand, have already invested in commercial real estate.

Damian Collins, Managing Director of Momentum Wealth and Chairman of the company’s property funds arm, Westbridge Funds Management, said investing in commercial real estate is advantageous, especially when it comes to regular rent returns. It is a valuable income-generating asset that is less susceptible to the sort of volatility sharemarkets are experiencing today.

Industrial and office rent collection improved steadily during 2021, peaking at 87 percent on many occasions, as reported by Elite Agent. While lockdowns impacted both sectors last year, the stabilisation of rent collection levels provided industrial and office landlords with stable cash flow.

More: Australia’s office market showed strong growth rate in Q1 2022; Q2 to easily exceed 2021’s

Commercial property leases for Australian retailers stabilised in H2 2021, indicating that retail property landlords should feel more confident about their future cash flow heading into 2022.

The retail sector also experienced a steady recovery last year, which showed the consumers’ preference for in-person shopping and the pandemic’s reduced impact. It will continue to flourish in 2022, hopefully returning to rent collection levels before the pandemic to provide landlords with stable and regular cash flow.

Herron Todd White recently released a report revealing that sales of industrial property have taken off in Q1 2022. The findings suggest that Brisbane, Gold Coast, and Ipswich are at the top of the market. Alice Springs, Darwin, Orange, and Central Coast are on the decline while Byron Bay, Lismore, Melbourne, and Townsville are on the rise. No areas were sitting at the bottom of the market.

“Supply line issues throughout the pandemic saw strong performance in cold storage, temperature-controlled facilities, and storage assets,” said Herron Todd White commercial director David Walsh. “With online shopping growing over the past 18 months to record highs, these types of assets will be of significant utility as e-commerce continues to be the consumers’ first choice for shopping.”

The Property Report editors wrote this article. For more information, email: [email protected].