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Commercial property takes the eye of investors

Staff Reporter 4 minute read

Kate Miller

Commercial property is representing an attractive option for buyers, according to the Real Estate Buyers Association of Australia (REBAA).

Michael Ramsay of Michael Ramsay Property, the Victorian representative of the REBAA, said he had observed an increase in interest in commercial property in Melbourne.

“Becoming more common is the enquiry for commercial property,” Mr Ramsay said.

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According to Mr Ramsay, capital growth on commercial properties in Melbourne was nearing a parallel with residential property.

Leases of five to 10 years and mandatory annual rent increases of three to four per cent were also adding to the attractiveness of commercial property as an investment choice, he said.

Peter Kearns, general manager of commercial lender Think Tank, said he expected activity in commercial lending to gather pace in the weeks ahead.

“We saw a bit of a pickup in July but that faded away in August, probably as a result of the election and also being a generally quieter time,” he said.“Once we know the result of the election we should see activity levels increase.”

While commercial lending policies had tightened in line with the global financial crisis and are unlikely to return to pre-GFC conditions, Mr Kearns said there were no significant barriers to securing commercial funding.

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“Generally speaking, if there aren’t any serious blemishes, you can certainly get deals through.”

Commercial property takes the eye of investors
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