Rising global demand, stabilising pricing, and a broader capital base expected to drive market momentum
Investment in Australia’s commercial property market is set to accelerate in 2025, driven by improving economic conditions, a broader capital base, and rising global demand, according to Cushman & Wakefield’s Market Outlook 2025 report.
Transaction volumes are expected to surpass 2024 levels as pricing stabilises and investor confidence strengthens. The office sector is projected to lead commercial property investment, with national annual transactions forecasted to rise from $9.8 billion in 2024 to $13.3 billion in 2025. Sydney is expected to remain the primary office investment hub, while Brisbane continues to gain ground on Melbourne.
The logistics and industrial sector is also poised for strong growth, with investment volumes anticipated to increase by nearly 40%, reaching $10 billion in 2025. Demand for alternative assets such as data centres, build-to-rent developments, and student accommodation is expected to push investment in these sectors to $11.5 billion. Emerging segments, including renewable energy and cybersecurity infrastructure, are also projected to expand.
“Australian commercial real estate has turned a significant corner, now more broadly in a phase of renewed growth,” said Noral Wild, chief executive of Cushman & Wakefield ANZ, commenting on the report.
The office market’s recovery is expected to vary across major cities, with Brisbane forecasted to see the strongest prime net effective rental growth at 12.1%, followed by Melbourne at 3.4% and Sydney at 2.6%.
Office demand in Sydney and Melbourne is being shaped by return-to-office policies, though full-time mandates remain limited among large occupiers. Meanwhile, offshore capital is likely to play a larger role in the logistics and industrial sector, with new investors from Japan and Europe expected to enter the market.
“A more diverse set of global investors is expected to target domestic assets,” said Dominic Brown, Cushman & Wakefield’s head of research ANZ.
Australia continues to be the world's tightest logistics and industrial market, with a vacancy rate of just 2.5%. As investment momentum builds in 2025, market participants anticipate greater diversification across asset classes and increased capital inflows from both established and emerging sources.
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