Foreign Investment Piles into Australian Commercial Property

• Foreign investment is driving renewed momentum in the Australian commercial property sector.
• Most capital is flowing into new economy assets—data centres, build-to-rent, and student accommodation—rather than traditional office buildings.
• This diversification is supporting rents and values in established sectors, preventing oversupply.
• Commercial property continues to offer investors both strong yields and capital growth potential.

oreign investment has re-emerged as a major force in Australia’s commercial property market—pointing to a structural recovery rather than a short-term bounce.

According to Vanessa Rader of Ray White Commercial, overseas investors committed $15.9 billion in the first half of 2025, already well ahead of the $10 billion recorded across all of 2023. A weaker Australian dollar has clearly enhanced our global appeal.

The inflows aren’t just into offices or retail. International capital is now favouring:

• Data centres, cold storage, and logistics facilities – driven by e-commerce and digital infrastructure needs
• Build-to-rent and student accommodation – supported by population growth and surging demand from international students
• Health and mixed-use projects – capitalising on demographic trends and urban regeneration

US investors remain the most active, contributing nearly $9 billion, while strong participation from Japanese, Korean, Singaporean, Hong Kong, and Thai groups broadens the investor base.

The Rider Levett Bucknall Crane Index backs up this surge in activity, recording 845 cranes nationally—well above the long-term average. This boom isn’t limited to capital cities either, with record construction in Adelaide, the Gold Coast, and Wollongong. Health, residential, and mixed-use projects lead the charge, while traditional office development is down 20%, reflecting subdued tenant demand and rising vacancies.

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