THE Bayside commercial market started in 2021 full of optimism after a busy end to 2020 and to date, market activity has not disappointed, according to Ray White Commercial’s latest Between the Lines* research.
“There has been a flurry of transactions occurring across both sales and leasing as the market responds to low interest rates and the appetite of investors to secure quality, income-producing assets,” said Ray White Commercial Bayside Director Nathan Moore.
“Vendors have responded with assets coming to the market, bringing preliminary volumes for the last 12 months to the end of quarter one of 2021 to over $126 million, a three-year high.
“Despite the pandemic still not being behind us and subsequent lockdowns again entering the marketplace in 2021, this has not dampened investment demand, nor business sentiment and activity.
“While we’ve witnessed activity levels increase across the bulk of the market, many property owners continue to be hampered with vacancies and uncertainties surrounding their assets.
“While demand levels have been growing, quality remains a key focus for both investors and tenants alike. Assets that have achieved the best results have been those that have continued to receive capital works to keep standards high.
“With interest rates expected to remain at historical lows for a prolonged period, the need for many buyers to seek out alternative investment options will keep demand for commercial assets elevated over the longer term, which may pressure yields downwards and keep capital values up.”
“The commercial property market has continued to move at a rapid pace across the Bayside region during the latter parts of 2020 and into 2021,” said Ray White Commercial Head of Research Vanessa Rader.
“Updated analysis shows that despite the economic concerns across most property markets during the COVID-19 period of 2020, activity levels were not impacted as the confidence to purchase during this time remained high, fuelled by low interest rates and cash-rich buyers.
“With vendors becoming more cautious in coming to market, a mismatch in supply and demand was created, culminating in a period of quality results and reduced selling durations.
“Over the year through to the end of March 2021, we’ve recorded $126.59 million in commercial sales represented by 100 transactions across the Bayside region; a remarkable increase compared to the prior 12 months where 61 sales occurred, totalling $73.12 million.”