Boom times looming for Queensland's commercial property market

Queensland is currently experiencing an era of significant growth, driven by a diversified economy, substantial infrastructure investments, and strong population growth.

This trajectory is expected to foster sustained expansion across various sectors in the medium to long term, particularly within the state’s commercial real estate landscape.

Strong fundamentals signal sustained growth

Queensland’s economy benefits from strong rankings across key economic variables, positioning the state as one of the strongest performing nationally.

Furthermore, the state’s economic diversification agenda as well as current infrastructure pipeline projects will support growth over the medium to long run.

Export diversification creates economic resilience

Queensland’s export sector contributes significantly to the state’s economic output. It remains Australia’s second-largest merchandise exporter, with exports totalling $105.4 billion in FY 2023-24.

Furthermore, Queensland has an active diversification agenda, with emerging sectors such as international education, technology, and innovation expected to enhance overall economic performance in the long term.

Office market stability

Queensland’s appeal extends beyond traditional economic measures, with Brisbane ranking as Australia’s most stable CBD office market, as evidenced by vacancy rates that demonstrate lower volatility compared to other major markets.

Brisbane CBD white-collar employment has grown 12 per cent over the past decade, led by healthcare (85 per cent), finance and insurance (34 per cent), and education and training (33 per cent).

White-collar labour force diversification creates a resilient foundation for office market performance.

Retail sector supply-demand imbalance

The retail sector presents compelling investment opportunities.

Queensland recorded the strongest shopping centre retail turnover growth among major states, with a total increase of 22.9 per cent from 2019 to 2024, compared to 16.1 per cent in NSW and 18.8 per cent in Victoria.

On the other hand, Queensland is facing the most severe retail supply-demand mismatch nationally.

The state requires 2.6 times more retail space than is currently in the development pipeline over the next five years.

Accelerated infrastructure investment within logistics, industrial

The Queensland State Government has demonstrated robust fiscal management, enabling significant infrastructure investment to be deployed, representing 5.7 per cent of Gross State Product annually over the next four years.

This significantly outpaces other states in relation to their economic size, with NSW at 3.8 per cent and Victoria at 3.1 per cent.

The delivery of new infrastructure projects will drive industrial and logistics sector activity, supporting the expansion of the blue-collar workforce and boosting manufacturing and construction activity.

Brisbane’s investment appeal continues to strengthen

Brisbane offers compelling value compared to global markets, with prime office price-to-earnings ratios demonstrating an appealing entry point for investors.

The correction in real estate values between 2022 and 2024 was less pronounced in Brisbane than in other major markets, reflecting the market's underlying stability.

The 2032 Olympic Games, ongoing knowledge economy expansion, and Queensland’s leadership in emerging sectors, such as AgTech, energy transition, and green hydrogen, provide multiple growth drivers for long-term real estate performance.