REA Insights Commercial Property Snapshot, July 2020

Commercial searches increased last week with NSW experiencing the largest jump. Photo: Seb Zurcher
Commercial searches increased last week with NSW experiencing the largest jump. Photo: Seb Zurcher

Despite the ongoing COVID-19 health and economic crisis, commercial property seekers are increasingly active on realcommercial.com.au. However, a closer look at the June data reveals some property types are faring better than others and there are interesting trends emerging in the buy and lease segments.

In this snapshot we start high-level with search volumes in June as well as demand by category and then provide an overview of the most popular commercial properties for the month.

How are search volumes tracking? 

June was characterised by a gradual easing of COVID-19 restrictions across most states, which coincided with an increase in on-site activity on realcommercial.com.au. However, it’s important to note that the June data pre-dates the re-instated lockdowns in Victoria, which will likely impact the data for next month.

Despite the ongoing COVID-19 health and economic crisis, commercial property seekers are increasingly active on realcommercial.com.au. However,  a closer look at the June data reveals some property types are faring better than others and there are interesting trends emerging in the buy and lease segments.

Despite these conditions, June monthly searches on realcommercial.com.au for both properties to buy and to lease hit a two-year high. Searches for commercial properties to lease were 29 per cent higher than they were a year ago and ‘for sale’ searches were up by 16 per cent year-on-year.  The data shows the growth is predominantly on the back of strong search volumes in New South Wales and Victoria.

As a result, June 2020 searches for commercial property surged to its highest point in two years.

What are people and businesses looking to buy? 

IJune 2020 there was an increase in views per listing across all asset classes for both ‘for sale’ and ‘for lease’ commercial properties – a rarity in what is a diverse commercial marketplace. 

Interest for commercial farming properties for sale was the standout with a 52 per cent month-on-month jump, taking the year-on-year growth to a bullish 85 per cent. The surge in demand for commercial farming could be attributed to increased demand for groceries with more people eating at home due to COVID-19 as well as a reduction in drought conditions in recent monthsas recently suggested by REA’s chief economist, Nerida Conisbee.  

Views per listing can also be reflective of the limited supply of commercial farms

After a significant drop at the start of COVID-19, views per listing for hotels rebounded and has stabilised month-on-month. The 65 per cent increase compared to the same time last year is on the back of strong growth in Queensland, which saw 184 per cent annual jump. 

Demand for medical facilities too has increased both month-on-month and year-on-year. The increased demand as occurred despite supply more than doubling in the past month, with the heightened activity largely due to COVID-19. 

What are people and businesses looking to lease? 

Views per listing has similarly increased across all asset classes to lease year-on-year, especially for retail listings, warehouses and medical facilities which saw more than 20 per cent year-on-year increase in views per listing in June. 

Demand for warehouses and retail listings available for lease have similarly increased month-on-month as investors look for properties for storage purposes, to cater for the persistent growth in e-commerceThe data shows the largest annual growth in views per listing for warehousewere in Tasmania, Queensland and Canberra.  

Due to the impacts of COVID-19 on the tourism industry, June 2020 saw an increase in hotel/leisure listings hitting the market, with the supply of listings available for lease more than doubling nationally compared to the month prior 

However, demand for listings in this sector has also increased, growing by 41 per cent month-on-monthdriven by interest for hotels in New South Wales and QueenslandAnnual growth for these two states was similarly positive, together with Tasmania showing a 25 per cent increase compared to the same time last year.  

Victoria too saw a 25 per cent month-on-month increase in demand but given the recent lockdown in Victoria, it will be interesting to see whether this trend continues in the July, or whether investors will look to markets where domestic tourism activity has started to recommence.  

What have been the most popular commercial listings? 

most viewed commercial listing in June 2020

A Dan Murphy’s in Chirnside Park, Victoria was the most viewed commercial listing in June 2020. 

See the top 10 most-viewed commercial listings nationally and in each state below.