Investors chasing high returns are looking to Brisbane, as commercial property yields fell across most Australian markets in the March 2026 quarter, according to the first monthly realcommercial.com.au Commercial Yield Report.
The report reveals a growing divide between markets: while Brisbane offers the strongest yields across industrial, office, and retail assets, Sydney and Melbourne remain at the lower end of the spectrum.
Industrial properties experienced the sharpest compression over the past year, with every capital city recording declines.
Perth and Adelaide were hardest hit, each seeing industrial yields fall by 37 basis points year-on-year.
Office yields were more mixed: Melbourne, grappling with the highest office vacancy rate among major cities, saw yields rise 37 basis points, while Adelaide and Sydney recorded declines of 37 and 12 basis points, respectively.
Retail property, traditionally the riskiest commercial asset type, also showed variation. Sydney and Melbourne saw softening, with yields rising 27 and 10 basis points, while Brisbane and Adelaide recorded improvements, down 14 and 33 basis points, respectively. Perth’s retail yields held relatively steady over the past 12 months.
The report notes that commercial property sales bounced back in 2025, supported by three interest rate cuts and a recovery in investor sentiment.
However, two of those cuts have already been reversed in 2026, and with inflation remaining elevated, interest rates are likely to rise further, a factor that could influence yields and investor behaviour in the months ahead.
Overall, Brisbane recorded the highest yields across all major asset classes, while Sydney and Melbourne were typically the lowest.
Adelaide stood out for recording the most significant declines in yields across industrial, office, and retail over both the past 12 months and the past five years. Analysts attribute this trend in part to the 2018 abolishment of stamp duty on commercial property transactions and growing investor demand in the state.
