Adelaide Commercial Property Loans & Development Finance Insights – Q2 2025

As Adelaide's commercial real estate markets show clear signs of recovery, growing confidence across asset classes is lifting demand for financing solutions.

Office Market Performance: Fuel for Lending Appetite

The Q2 2025 Adelaide CBD office market remains stable, supported by two straight years of positive net absorption and strong tenant interest across 2024 and into mid‑2025.

Notably:

• Net absorption totaled 22,600 sqm in H2 2024, with quality leasing levels persisting into 2025 (JLL, Cushman & Wakefield, Cushman & Wakefield).

• Developers delivered ~21,000 sqm at 42‑56 Franklin Street and refurbished ~9,500 sqm at 45 Pirie Street, invigorating A‑Grade stock (Cushman & Wakefield).

This acceleration in leasing activity is boosting both tenant demand and lender confidence in commercial property loans Adelaide, as occupiers return and rent levels stabilise.

Rental Trends & Incentives: Why Loans Are Now More Viable

The introduction of high‑quality office space elevated face rents and spurred incentives:

• A‑Grade face rents rose, while average net effective rents softened from AUD $310 to $300/sqm pa in Q2 (Cushman & Wakefield).

• Tenant incentives increased from ~37% in Q1 to ~41% in Q2—a positive sign of tenant market leverage .

So, while borrowers seeking commercial property loans Adelaide still enjoy strong terms from tenants, lenders can find assurance in rising effective rents across quality stock.

A panoramic view of Adelaide's skyline, highlighting the balance between urban growth and green spaces, reflecting the dynamic property market.

Project Pipeline & Property Development Finance

Building momentum continues, and major schemes are progressing:

• ICD’s Market Square (22,000 sqm, due 2026) and Festival Tower Two (50,000 sqm, due 2027) are underway (Cushman & Wakefield, JLL).

• JLL reports 42,700 sqm under construction, including the Kyren Group’s 21,000 sqm project at Franklin Street (completing Q2 2025) (JLL).

With a strong flight-to-quality trend, these developments are prime targets for property development finance Adelaide and #development finance adelaide. They offer lenders long-term growth drivers underpinned by absorption forecasts and tenant demand.

Economic & Investment Drivers

• South Australia’s economic growth is projected at 3.1% in 2025, then moderating to 1.3% in 2026 (Cushman & Wakefield).

• Prime office yields holding between 6.9%–7.8%, and secondary yields compressing to 7.1%–8.1%, indicate markets are near the cycle bottom (Cushman & Wakefield).

These stable yields make financing new developments and office acquisitions—through commercial property loans Adelaide—a compelling proposition.

Warehouse & Industrial Demand: Warehouse Finance Adelaide

While the Q2 office report doesn’t cover industrial/warehouse, national and state-level trends show rising logistics interest. Adelaide, with its central location, stands to benefit as tenants centralise and seek warehouse space. This creates demand for warehouse finance

Adelaide:

• Investors are increasingly active in industrial and logistics sectors nationally (The Australian).

• Lower interest rates and RMB easing support warehouse acquisition and development lending.

Aerial view of a modern industrial property showcasing a spacious warehouse with loading docks, parked trucks, and ample parking space.

Why Now is Prime Time for Adelaide Commercial Property Financing

1. Flight-to-quality office dynamics – Occupiers shifting to A‑Grade offices support stable rent and effective financing.

2. Robust pipeline – New office towers signal property development finance Adelaide opportunities.

3. Industrial tailwinds – As national industrial investment strengthens, warehouse finance Adelaide demand should follow.

4. Investor momentum – Commercial real estate in Adelaide is outpacing other markets (Cushman & Wakefield).

Summary – CapStack’s Strategic Position

• Commercial Property Loans Adelaide: Leverage rising quality stock and stable tenant demand, backed by projected economic growth.

• Property development finance Adelaide: Finance new office buildings with absorbed demand and tractable yields.

• Warehouse finance Adelaide: Capitalise on logistics momentum and industrial growth.

As Adelaide's commercial real estate markets show clear signs of recovery, growing confidence across asset classes is lifting demand for financing solutions. — particularly in commercial property loans Adelaide, property development finance Adelaide, and warehouse finance adelaide.

Adelaide’s mid‑2025 property market offers fertile ground for targeted financing strategies. CapStack is ideally poised to support borrowers with tailored lending solutions in offices, developments, and warehouses, meeting borrower needs and delivering strong risk-adjusted returns.

Why CapStack

At CapStack, we understand the unique challenges and timelines facing developers and commercial property investors in the Adelaide market. With deep relationships across Australia's leading non-bank lenders, private credit funds, and institutional financiers, we’re able to structure finance solutions that align with your project milestones and investment strategy. Whether you’re acquiring a CBD office asset, refinancing a landbank, or raising equity-backed construction funding, our advisory-led approach ensures you’re equipped with capital that works as hard as you do.

What sets CapStack apart is our hands-on, entrepreneurial mindset — we’ve built businesses and financed them ourselves. That means we don't just provide funding; we bring a strategic perspective on risk, returns, and market timing. From structuring presale risk to navigating planning conditions or staging warehouse developments, our team becomes your long-term capital partner in Adelaide’s evolving property landscape.

Ready to finance your next Adelaide project? Contact CapStack today to explore customised loan structures for commercial, development, or warehouse opportunities.