Commercial property transaction activity is on the rise, with $29.2 billion in Australian office, retail, industrial, hotel and living sector assets changing hands in 2024.

The preliminary end-of-year total is 21% up on 2023 levels according to CBRE data, highlighting obvious green shoots of recovery in the commercial property investment sector.

CBRE’s Australian Head of Capital Markets Research Tom Broderick noted, “Investors are acknowledging the value on offer in various sectors of Australia's real estate market. Pricing seems to have stabilised after a period of yield softening. Additionally, many existing assets are selling significantly below replacement cost, underscoring the value proposition.”

The office sector staged the biggest comeback, regaining its status as the most traded commercial property sector after $8.4 billion in transactions – up 56% y-o-y. Major transactions in Sydney, including Mitsui Fudosan’s acquisition of a 66% stake in 55 Pitt Street, were key drivers of this uplift. 

Retail also rebounded strongly to be the second most active sector, with $7.3 billion in assets changing hands, up 34% y-o-y.

Industrial & Logistics was in third position with $7.1 billion in transactions (+14%), followed by the fast-growing living sector, with $4.8 billion in deals (+6%).

Hotels was the only sector where transactions declined, with $1.6 billion in assets traded, compared to $2.5 billion in 2023.

Offshore investors were particularly acquisitive according to CBRE’s data, accounting for $8.3 billion in acquisitions, 37% up on the prior year. This represented 28% of the overall 2024 transaction tally, compared to 25% in 2023.

CBRE’s Pacific Head of Capital Markets Flint Davidson noted, “Australia has proven to be one of the more liquid markets in Asia Pacific with price corrections showing genuine value, which is hard to find in developed markets across the region. Australia’s stability and transparency is a key drawcard, as is our strong population growth, which is driving demand for real estate.”

Offshore buyers were most active in the office sector, given the deep discounts on offer compared to peak pricing and replacement costs.

Living was the next most favoured sector, following several major student accommodation and build-to-rent transactions, including the Ontario Teachers’ Pension Plan and Hines acquisition of the Arklife BTR Portfolio. (Image above)

By country, the United States became the number one source of overseas investment in 2024, accounting for $3.6 billion in deals – more than double last year’s investment.

Japanese investors dropped to second place, but remained active, with $1.9 billion in acquisitions (-9% y-o-y), while Singaporean investors accounted for deals totaling circa $1 billion.

Selected CBRE 2024 news published across Williams Media publications: 

CBRE Published on The ASEAN Developer:

Ontario Teachers’ Pension Plan and Hines acquire Build-to-Rent portfolio in Australia | The ASEAN Developer

Asia Pacific living sector poised for growth: Japan and Australia lead investments - CBRE | The ASEAN Developer

A former Southern Rural Water Site with a planning permit for 58 townhouse development for sale by CBRE  | The ASEAN Developer

CBRE Published on COMMO:

BBC Studios move to boutique Blue & William office in North Sydney - CBRE | Commo.

Charter Hall childcare centre’s $18.5 million sale sets the standard - CBRE | Commo.

Sydney icon Luna Park sold to Oscars Group by CBRE | Commo.

ISPT to sell half-share in Sydney’s Warriewood Square shopping centre - CBRE | Commo.

Lenders eye Australia’s fast-expanding data centre market - CBRE | Commo.

Interactive virtual viewing technology set to level up CBD office leasing - CBRE | Commo.

National CBD office sublease availabilities hit lowest levels since 2021 - CBRE | Commo.

Australia’s office leasing market poised to enter a new phase - CBRE | Commo.

CBRE Published on The Hotel Conversation:

Brisbane Mantra Terrace sold to NRL by CBRE | The Hotel Conversation

Brookfield to acquire Brisbane’s Hotel X - CRBE | The Hotel Conversation

Shakespeare Property announces acquisition of Woolstore 1888 by Ovolo in Darling Harbour, Sydney | The Hotel Conversation

Top events driving Australian hotel demand - CBRE | The Hotel Conversation

CBRE Published on The INDUSTRIALIST:

Industrial & logistics becomes Australia’s largest commercial property sector at $300 billion - CBRE  | The Industrialist

Australia’s national industrial and logistics vacancy rate lifts to 2.5% - CBRE  | The Industrialist

AUKUS submarine project set to boost investor demand | The Industrialist

Acacia Ridge warehouse leased to Sugar Research Australia by CBRE | The Industrialist

ESR’s new industrial estate Reservoir Business Hub warehouse leased - CBRE | The Industrialist

CBRE Published on Retalk Asia:

Asia Pacific embraces hybrid work and flexible workplace - CBRE | RE Talk Asia

Tokyo, Bangkok, and Seoul lead APAC retail innovation index – CBRE | RE Talk Asia

Asia Pacific Investors Face Minimal Debt Funding Gap; Australia and Mainland China Have Largest Gaps: CBRE Analysis | RE Talk Asia

CBRE Published on The Real Estate Conversation:

Local buyers and upgraders most active in Australia’s prestige residential market -CBRE | The Real Estate Conversation

First home buyers drive demand for residential property nationally - CBRE | The Real Estate Conversation