Charter Hall's Chullora Marketplace acquisition hints at commercial property revival

Commercial real estate sentiment is on the rise. After several years of hesitation, buyers are stepping back in as borrowing costs ease and banks increase their appetite for high quality, property backed commercial lending. Confidence is no longer absent, it is slowly returning, as reaffirmed by our recent discussion with Auctionworks.

Charter Hall Chullora Marketplace acquisition

The turning point has been interest rates and strong income growth in certain segments, like convenience retail with strong supermarket anchors. Charter Hall's recent acquisition of Chullora Marketplace adds weight to this trend.

Charter Hall paid for $145 million in an off-market transaction, securing a 5.8 ha infill site located 14 km southwest of Sydney CBD. Anchors include Woolworths, Coles and Aldi and supported by $168 million in annual turnover, $112 million of which comes from the supermarkets.

These are the types of transactions that will start to flow down into smaller assets over the coming year.

Outlook for commercial property

We believe more cuts will come over the next twelve months. Lower rates mean stronger borrowing capacity. They ease cash flow for existing landlords and open the door for new buyers who were previously sidelined.

Property is a confidence game. When rates climb, sentiment falls. When rates fall, sentiment bounces. We are seeing that shift now. Retail, and industrial are all finding their level again as investors anticipate cheaper debt and a more supportive market backdrop. Office might take more time, the jury is still out.

At Flexdoc, we work with self-made borrowers to ensure they can move quickly when opportunities arise. Commercial property auctions are won by those who can act with certainty. The next twelve months will be shaped by falling rates, rising confidence, and a new cycle of opportunity.

Reach out to our team about your property investing plans, start here.