Published 1 February 2026. Figures and market conditions described here were current at that time and may have changed since.
Australia's commercial property market has experienced a significant rebound in 2025, with transaction volumes reaching $85.58 billion across 9,015 sales, marking a 27 per cent increase over 2024 figures.
Ray White Group Head of Research, Vanessa Rader, revealed that while the headline growth appears strong, it masks diverging geographic preferences and evolving sector appeal across the country.
Queensland emerged as the clear winner, with transaction volumes growing 61.1 per cent to $21.35 billion, capturing nearly 25 per cent of national activity.
The state's appeal extends beyond Brisbane alone to encompass industrial demand along growth corridors, retail centre resilience, and genuine scarcity of investment-grade stock in locations such as Gold Coast and Sunshine Coast.
Queensland's average transaction size jumped 56.2 per cent to $10.79 million, indicating substantial capital deployment in quality assets rather than opportunistic trades.
In stark contrast, Victoria experienced a decline of 5.5 per cent to $17.30 billion, slipping to 20.2 per cent of national activity from 24.3 per cent in 2024.
"The state's commercial property tax settings continue deterring capital, with sophisticated investors simply choosing alternative markets offering comparable returns without additional cost burdens," Ms Rader explained.
Western Australia and South Australia both posted solid growth, with transactions increasing by 5.7 per cent and 10.3 per cent respectively.
"East coast investors are increasingly targeting WA opportunities, recognising the state's economic diversification and relative value compared to east coast pricing," she said.
Industrial property retained its position as Australia's most-traded sector at 31.1 per cent of volumes, reaching $26.58 billion, up 27.6 per cent from 2024.
"The sector's fundamentals remain compelling: low vacancy rates, limited development pipelines, and ongoing e-commerce and logistics demand," Ms Rader said.
"Average transaction sizes reached $6.05 million, up from $5.20 million, as buyers recognise existing stock carries genuine scarcity value with replacement costs remaining elevated."
Retail delivered the year's most notable shift, with volumes climbing 43.8 per cent to $18.90 billion, representing 22.1 per cent of total activity.
Office property accounted for 18.9 per cent of volumes at $16.17 billion, up 28.1 per cent, though Ms Rader cautioned this masks divergent performance within the sector.
"Premium CBD assets in Sydney, Brisbane and Melbourne attracted capital, while suburban markets have had mixed fortunes with elevated vacancies and quality disparity," she said.
Alternative assets, including childcare centres, service stations, and aged care facilities, climbed 80.5 per cent to $9.04 billion.
"This growth represents renewed confidence in alternative property classes offering defensive income characteristics," she explained.
According to Ms Rader, the most significant market indicator is the average transaction size, which climbed to $9.49 million across all sectors, up 24.6 per cent from $7.62 million in 2024.
Looking ahead to 2026, Ms Rader said interest rate policy would be critical for the market's continued momentum.
"If rates fall as markets anticipate, development activity should accelerate meaningfully, while continued focus on existing stock will reflect replacement cost economics and genuine scarcity value in quality assets," she said.
Want to know if this applies to you?
Talk it through with a Finfident broker. It's free and there's no obligation.
