Commercial Property: 2024 Flows & 2025 Insights
- Team CapStack
- Jan 30
- 2 min read
Vanessa Rader, Head of Research for the Ray White Group, recently provided a commercial property report focused on the flow of commercial property dollars in 2024, and what insights we can take away for 2025.
2024 ➡️ 2025
▪️ Challenging Start: 2024 began with uncertainty around financing costs and economic conditions, leading to cautious market sentiment and extended sales periods.
▪️ Late-Year Surge: Despite a slow start, the market closed strongly with total transaction volumes reaching $76.64 billion—up 19.2% from 2023—driven by institutional activity.
▪️ Private Investors Held Steady: Sub-$20 million deals from private investors and owner-occupiers provided consistent support throughout the year.
Sector Insights
▪️ Industrial Sector Dominates: Representing 39.6% of sales, industrial properties led the market, with strong demand for data centers, cold storage, and self-storage facilities.
▪️ Development Sites on the Rise: Transactions hit $11.8 billion, though challenges like high construction costs and labor shortages impacted high-density residential projects.
▪️ Retail Resurgence: Neighbourhood and sub-regional centres saw renewed interest, making up 19.1% of transactions, thanks to their alignment with evolving consumer preferences.
▪️ Office Sector Rebounds: A late-year recovery saw average sale prices rise to $5.3 million, though a clear divide remains between prime and secondary assets.
Specialised Assets
▪️ Medical Facilities Shine: Resilient demand driven by essential services and demographic trends.
▪️ Childcare Faces Pressure: Oversupply and demographic changes impacted occupancy.
▪️ Service Stations Stay Strategic: Long leases and strong locations maintained interest, despite environmental and financing challenges.
Looking Ahead to 2025
➡️ A more strategic investment approach is emerging, with opportunities in both prime and secondary assets.
➡️ Industrial assets remain highly sought after, while the retail sector continues to grow in appeal.
➡️ Success will favour investors identifying strong fundamentals and clear value-add opportunities amid evolving economic and financing conditions.
What’s your take on the commercial property trends for 2025? Are you seeing opportunities or challenges in your area of interest? We’d love to hear your thoughts—share your perspective in the comments below!
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