The commercial property market in Brisbane's Bayside and Redlands region has experienced a record-breaking financial year across all asset classes, according to the Ray White Commercial Bayside End of Financial Year Wrap report.
The COVID-19 pandemic seemingly had little effect on sales and leasing activity, with a particularly robust market for sub-$5 million assets and fully tenanted investments.
Ray White Commercial Head of Research Vanessa Rader said that during the 2020/21 financial year, $116.96 million worth of commercial property changed hands in the Bayside region.
"This represents a 10.81 per cent increase on the year prior, showing how well this region has continued to function through a tumultuous period," Ms Rader said.
Ray White Commercial Bayside Director Nathan Moore said that while many businesses and landlords navigated changes to trade restrictions impacting their bottom line, the resilience of the commercial property market was outstanding.
"Fuelled by low interest rates and diversification, we've seen a dramatic increase in demand for quality commercial assets," Mr Moore said.
"After a slow start to the financial year, we quickly saw a rise in turnover and capital values, with new yield benchmarks set for investors and huge improvement in the rental market," he said.
Industrial continues to be the most active asset class across the region, with an average sale price of $840,000 in 2021.
"The price point of industrial is attractive to cashed-up buyers, wanting to take advantage of improved lending conditions," Mr Moore said.
"We have had a huge turnover of industrial stock in Capalaba, with most transactions coming in under the $1 million price point."
Despite uncertainties in both the retail and office sectors off the back of the pandemic, the market has bounced back with the increase in buyer appetite.
Retail stock sold for an average price point of $1.24 million, and office stock sold for an average of $901,000.
The Wynnum/Manly precinct has also seen an uptick in sales activity, up by 12.63 per cent on the prior year.
"This region is dominated by retail sales including showroom facilities, with yields as low as 1.50 per cent for assets which are not fully tenanted, as buyers look to the potential returns of up to 7 per cent when fully occupied," Mr Moore said.
Nathan Moore also said that the leasing market is performing very well across all asset classes, despite a tumultuous year.
"After a particularly devastating year for small business, we are really pleased that vacancies across the region still remain low, with leasing deals continuing to transact," Mr Moore said.
Mr Moore reiterated that stock levels remain well below enquiry level, as both local and interstate investors seek out quality assets across the region.
"Capital values have seen strong increases, and we expect this to continue if demand levels remain elevated," he said.
Read the full report.
Nathan Moore
Director – Ray White Commercial Bayside
nathan.moore@raywhite.com
Vanessa Rader
Head of Research – Ray White Commercial
vrader@raywhite.com
Nina Clarke
Ray White Media
nclarke@raywhite.com
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