Powered by MOMENTUM MEDIA
Powered by MOMENTUM MEDIA
SUBSCRIBE TO OUR NEWSLETTER SIGN UP
Market conditions ‘ripe’ for SMEs to buy commercial property
Powered by MOMENTUM MEDIA

Website Notifications

Get notifications in real-time for staying up to date with content that matters to you.

sme logo

Market conditions ‘ripe’ for SMEs to buy commercial property

sold signage ta sold signage ta
Reporter 2 minute read

Now could be a good time for SMEs with SMSFs to acquire their business premises, a commercial lender has suggested.

Thinktank director Per Amundsen said that there are a number of well-known financial benefits of using self-managed super funds (SMSFs) to acquire commercial premises, including tax minimisation and wealth creation.

Advertisement
Advertisement

But on top of these, the commercial lender suggested that market conditions are “ripe” for SMEs with SMSFs to purchase property.

“The secondary market for commercial property can be closely linked to the primary market,” Mr Amundsen explained.

“Rising prices in the latter, in many circumstances, will have a flow-on effect on the former. In particular, tighter vacancy rates in Sydney and Melbourne are pushing prices up across both primary and secondary markets.”

The director cited figures from the Property Council of Australia which show improvements in vacancy rates across all CBD markets due to strong demand, with Sydney and Melbourne expected to have vacancy rates below 4 per cent.

“Falling CBD vacancy rates help underpin commercial property prices right across the market. There’s a ripple effect flowing out from this CBD activity, so for SMEs it’s an ideal opportunity to either sell their commercial premises to their SMSF or use their fund to acquire premises,” Mr Amundsen said.

He added that there are similar opportunities for SMEs in the manufacturing and construction sectors.

“The industrial property market, where Thinktank has 43.6 per cent of its loan book at $363 million, is benefitting from a stronger manufacturing sector with the ACCI-Westpac Survey of Industrial Trends for the June quarter rising [by] 4.4 points to 63.8,” the Thinktank director explained.

“Manufacturing continues to benefit from local apartment and infrastructure projects that are still boosting demand, with 37 per cent of businesses expecting the general business environment to strengthen over the next six months.”

Mr Amundsen said that this “paints a positive picture for industrial property”, further reinforced by stable rental rates in most cities (except Perth) but with yields continuing to tighten Australia-wide.

[Related: ]

Market conditions ‘ripe’ for SMEs to buy commercial property
sold signage ta
TheAdviser logo
sold signage ta
FROM THE WEB
more from the adviser
tick document ta Conversion rates increase despite credit crackdown

An increasing number of loans lodged by brokers are progressing t...

court gavel ta Identity theft ring responsible for multimillion-dollar fraud

ASIC and the AFP have begun court proceedings against suspected m...

SME broker bootcamp How brokers can help support SME clients grow

Helping SME clients secure finance is one aspect of a finance bro...