Commercial Property Snapshot, October 2021
Demand to buy and lease commercial property slowed slightly over September, with ongoing lockdowns continuing to impact the market.
Lockdowns have resulted in a growing divergence between buying and leasing demand. Searches to buy were 22% higher in September, compared to 12 months ago, while searches to lease were 8% lower.
In this month’s commercial snapshot, we continue to track search volumes over time and demand by category. We also provide a view of user behaviour by analysing the most-searched keywords per asset class as well as looking at the most popular commercial property listings for the month.
How are search volumes tracking?
Searches to buy commercial property declined by 4% nationally over September, though movement varied by state. The fall in searches was greatest in Victoria, where property inspections were banned over the first half of the month.
In contrast, New South Wales, in which property inspections have been allowed throughout lockdown, saw the strongest growth in buy searches over September, at 7.2%.
Searches to lease commercial property dipped by 2.4% nationally in September, with performance again varying by state.
As with the buy category, lease searches saw the strongest growth in New South Wales, up 17.4% over the month. Counteracting this growth were declines in Victoria (-7.9%) and Western Australia (-8.9%).
The office sector has seen the strongest year-on-year growth in buy searches, which are more than double (105%) last year’s levels. After a shaky performance in 2020 resulting from the rise in remote working, investor confidence in the sector is returning.
The medical/consulting sector followed, with buy searches up 79% year-on-year. The resilience of the medical sector in comparison to other industries hard hit by the pandemic, has supported demand for these assets.
Leasing demand for medical/consulting assets has also been strong, increasing by 31% over the 12 months to September.
The hotel/leisure sector continues to face challenges, with leasing searches down 9% from 12 months ago.
What are people and businesses looking to buy?
The medical/consulting sector recorded the largest month-on-month increase in views per ‘for sale’ listing in September, up 11%, followed by land (5%) and retail (4%).
Commercial farming and showrooms, however, each saw views down 8% over the month.
Comparing year-on-year, views per listing have increased across every asset type, with the strongest gains seen in the industrial (91%) and showroom/large format (75%) sectors.
What are people and businesses looking to lease?
Compared to 12 months ago, views per ‘for lease’ listing have increased across all asset types. The industrial sector has seen the strongest growth, at 40%, followed by showroom/large format at 35%.
The hotel/leisure sector has seen the weakest growth in views per ‘for lease’ listing over the past 12 months, at just 6%. In a sign that the sector may be seeing some green shoots of recovery, hotel/leisure recorded the largest monthly gain in September, with views up 21%.
What are the features that people and businesses are looking for?
In this month’s analysis of most-searched keywords, the prevalence of ‘childcare’ has continued to grow. ‘Childcare’ was the most searched keyword accompanying searches in both the medical/consulting and land/development sectors. The incidence of ‘childcare’ has also increased in both the retail and office sectors.
Demand for industrial property from both buyers and occupiers, continues to push the keyword ‘industrial’ up the ranks. ‘Industrial’ has now overtaken ‘residential’ as the second most searched keyword accompanying land/development searches.
What have been the most popular commercial listings?
See the top 10 most viewed commercial listings nationally and in each state below.
The most viewed listing in September was a two-storey heritage listed office in Clare, South Australia, which has been occupied by ANZ since 1877.