Property Council Chief Executive Mike Zorbas said the current package is hurting market confidence and will put new housing and new projects at risk.

“Australia’s housing challenge is a supply challenge. The government has confirmed these changes fail the most important test – they deliver fewer homes”.

The submission sets out that the proposed tax changes come into a system already under sustained pressure, with elevated construction costs, financing constraints, tradie shortages and post approval bottlenecks against the background of confidence-sapping changes to discretionary trusts.

It warns that weakening investment conditions will directly impact project feasibility and the number of homes that get built.

“Projects don’t proceed unless they stack up. When you increase costs or reduce confidence, fewer projects get built (continues below).”

“Taxes on investment in new housing are already sky-high. Almost 40 per cent of the cost of a new home is taxes and charges across all levels of government”.

Mr Zorbas warned that layering additional uncertainty across multiple parts of the tax system risks dampening investment at precisely the time it is needed.

“The CGT and negative gearing reforms – combined with the Budget night tax hike on discretionary trusts and the retrospective foreign land CGT changes – are creating significant uncertainty across an industry that directly employs more than 1.4 million people.”

“I urge the Parliament to consider that if changes to CGT and negative gearing do proceed despite the project impacts outlined, grandfathering and the carve-out of new builds will be essential to protect market confidence and ultimately jobs.”

Bunnings Group will take control of workwear supplier Workwear Group and industrial distributor Blackwoods, from parent Wesfarmers next month.

The transfer is part of a Wesfarmers restructure to consolidate businesses serving trade, construction and industrial customers.

Hard Yakka, KingGee and NTT Uniforms – the latter which supports corporate and government clients – are amongst the apparel brands soon to be owned by Bunnings, care of the Workwear Group deal.

Blackwoods meanwhile, with 45 stores and six distribution centres, is an established industrial and safety supply manufacturer and supplier, servicing construction, infrastructure, manufacturing and mining clients.

Bunnings ventures into supplies, uniforms, safety

The move will extend Bunnings’ reach into the uniform and safety apparel sector, the latter where it will compete with RSEA, which is privately held, with some 95 stores in Australia and New Zealand (continues below).

It also comes at a time traditional clothing retailers enter the workwear sector including recently Asics.

“This transition will improve Bunnings’ ability to serve small to medium sized customers by offering greater access to Blackwoods’ extensive product range and national fulfilment capabilities,” Bunnings managing director, Mike Schneider, said.

“Blackwoods and Workwear Group will continue to operate as standalone businesses and will retain their customer-facing brands…with Blackwoods continuing to service large enterprise customers,” according to the executive.

“The Industrial and Safety businesses will transition to Bunnings on 1 July 2026, and their financial contributions will be included in Bunnings’ results for the first half of the 2027 financial year,” a statement for the group added.

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Australia’s latest Federal Budget may prove to be a pivotal moment for commercial property.

While much of the national conversation has centred around housing affordability and changes to residential investment settings, the flow-on implications for commercial real estate could be significant, particularly as investors reassess where capital is best deployed over the next decade.

According to Daniel Wolman, International Director and Head of Investment Sales Australia at Cushman & Wakefield, the Budget has further sharpened the relative appeal of commercial property when compared to residential investment.

“We expect to see increased investor focus on commercial assets over the medium term as the structural advantages of the sector become more pronounced.

“With residential negative gearing now restricted, commercial property continues to offer compelling fundamentals including stronger yields, longer lease profiles and the retention of tax deductibility.”

The shift is expected to attract a broader pool of private capital into the commercial market, particularly from investors traditionally weighted toward residential property.

“For many investors, this creates an opportunity to diversify into assets that can deliver more stable income streams and stronger cash flow characteristics,” Mr Wolman said.

“Commercial property has always appealed to investors seeking income resilience, but these policy settings further reinforce that positioning.”

This renewed confidence is already beginning to translate into stronger market activity across the commercial sector and Mr Wolman said the improving capital markets environment was reinforcing commercial property’s position as a compelling long-term investment vehicle.

“We’re seeing increasing amounts of capital targeting commercial assets with strong underlying fundamentals, particularly as investors look for stable income, yield resilience and long-term growth potential,” he said.

“This momentum is expected to continue as institutional and private investors reposition portfolios in response to changing tax settings and improving market conditions.”

Another major takeaway from the Budget is the continued support for new-build developments across multiple commercial asset classes.

According to data from the Australian Government Federal Budget 2026, under the current framework, developers of eligible new-build assets remain entitled to the existing 50 per cent capital gains tax discount, a carve-out expected to stimulate development activity despite broader tax reforms impacting other sectors.

The implications extend across office, retail, build-to-rent, industrial and build-to-suit developments, sectors already experiencing evolving occupier demand and growing institutional interest.

Investor appetite for prime-grade assets also continues to strengthen, with Melbourne recently recording its largest CBD retail transaction of the year with Midtown Melbourne selling for $154 million through Cushman & Wakefield, on a core cap rate of 7.0 per cent, reflecting sustained demand for high-quality assets offering secure income and attractive yields (continues below).

Mr Wolman said the depth of active capital in the market remained significant. “Across Victoria alone, our Investment Sales team is currently tracking more than 21 active underbidders and groups with in excess of $2.8 billion in capital seeking deployment into commercial assets with strong fundamentals,” he said.

“That level of capital waiting on the sidelines demonstrates the weight of investor demand still targeting quality opportunities despite broader economic uncertainty.

“The retention of the CGT discount for new-build projects provides important certainty for developers and investors alike.

“It supports the viability of new supply at a time when Australia still faces a significant shortage of modern, sustainable and fit-for-purpose commercial space across many markets” Mr Wolman said.

At the same time, the Federal Government’s commitment to a 10-year, $120 billion infrastructure investment pipeline is expected to underpin long-term property fundamentals nationally.

Historically, major infrastructure spending has acted as a catalyst for commercial property growth, supporting employment, population expansion, logistics efficiency and urban connectivity.

The scale of the latest commitments is likely to reinforce long-term demand across industrial precincts, metropolitan office markets, mixed-use developments and emerging growth corridors tied to transport and infrastructure investment. Such examples include North Sydney Metro, Victorian Suburban Rail Loop, Brisbane Olympics, to name a few.

“Infrastructure investment of this magnitude provides a strong foundation for long-term commercial property performance. It drives economic activity, improves connectivity and ultimately supports tenant demand and capital growth across multiple commercial asset classes”.

Mr Wolman went on to say that the Budget arrives at a critical time for the commercial property sector, with interest rates still climbing, geopolitical uncertainty continuing to weigh on global markets and investor confidence remaining somewhat shaken following an extended period of caution.

“Against that backdrop, the Budget provides greater clarity and a framework for capital moving forward, further reinforcing commercial real estate as a reliable and defensive asset class. While market conditions remain challenging, we anticipate geopolitical pressures will gradually ease and interest rates will begin to stabilise over the medium term, potentially moving into a more supportive environment in the back half of 2027.

“As confidence progressively returns, we expect transactional activity and investor sentiment to continue improving across the commercial property sector.”

“While challenges remain across some sectors, particularly older office stock and construction feasibility pressures, the broader policy direction appears increasingly supportive of commercial real estate investment and development.

“For investors and owners, the message from this year’s Federal Budget is becoming clearer: commercial property is likely to play an increasingly important role in Australia’s next investment cycle” he said.

Australia’s purpose-built student accommodation pipeline has climbed to 47,233 beds, though the distribution of new supply is disproportionate to the scale and location of anticipated student demand.

Student Accommodation Council Executive Director Adele Lausberg said high demand for purpose-built accommodation reflects the role it plays in housing international students and easing pressure on the broader rental market.

“When students come to Australia, they are here to study and overwhelmingly choose purpose-built student accommodation designed for their needs,” Dr Lausberg said.

“That means more students are housed in dedicated accommodation, taking pressure off the private rental market in our major cities.”

The latest Urbis Student Accommodation Benchmarks, produced in partnership with the Student Accommodation Council, shows a significant increase on last year’s pipeline of around 40,000 beds, with projects progressing across development application, approval, and construction.

“More than 14,100 beds are currently under construction, with a strong pipeline of new supply expected to come online through to 2028,” Urbis Director Alex Stuart said.

“We are seeing a very real shift in capital allocation decisions. Investors are increasingly looking outside NSW and Victoria because the settings are simpler, more stable, and ultimately more investable.”

The national development pipeline shows a widening divergence between Sydney and Perth, as policy settings related to break lease clauses under the Residential Tenancies Act in New South Wales increasingly divert investment capital to more favourable markets interstate. 

Perth is leading the country in projects progressing into construction, with 4,224 beds currently underway, reflecting strong investor confidence and supportive policy settings.

Sydney shows signs of being persistently under-supplied – despite having the largest share of international students in the country. It lags its demand share even at the development approval stage and has less than half the pipeline it needs to match demand (continues below).

Purpose-built student accommodation operates on academic cycles, with shorter stays aligned to semesters, and needs a fit-for-purpose framework so that more projects can be built.

“A student living in purpose-built student accommodation has access to everything they need – security, safety, and community, creating a foundation for student well-being and success. But the NSW break lease settings, whilst being a well-intended policy, are having unintended consequences.”

The current NSW framework limits the ability for operators to recover costs when students exit leases early, creating uncertainty in future bookings and undermining the viability of the purpose-built student accommodation sector in NSW, as reflected in the pipeline data.

“Student accommodation is different to the traditional rental market, and has intakes largely aligned with university semesters, and provides a wraparound experience catered specifically for students. Break lease settings go directly to feasibility, and Sydney desperately needs all the housing it can get.”

Brisbane is seeing decent movement into delivery, but also faces break lease RTA issues, while Adelaide continues to build momentum across the pipeline with a steady flow of projects moving through applications, approvals and construction.

Melbourne holds the largest pipeline nationally at 12,656 beds, though the majority remain in planning application and approval stages, and construction is not necessarily guaranteed. The impact of steep Land Tax charges on student accommodation beds in Victoria is a key factor delaying projects as they move from development approval to construction.

“It’s not just about how much pipeline exists. It’s about how much of that pipeline is actually investable and deliverable,” Dr Lausberg said.

“Where governments provide operational clarity, streamline planning, and support investment, projects are progressing into construction and delivering new homes for students.”

In the priciest take-private of an ASX-listed real estate investment trust, offshore giants Brookfield and GIC have bought National Storage REIT – Australia and New Zealand’s largest self-storage owner and operator.

Securityholders received $2.86 per security cash – implying an enterprise value of about $6.7 billion including debt and committed development spending.

The deal includes control of over 300 self-storage centres and 100,000 residential and commercial customers.

Also with the development pipeline – for c490,000 square metres – the portfolio was valued at c$5.8b when the offer emerged in December.

Biggest take-private of ASX-listed REIT

Founder and managing director Andrew Catsoulis listed National Storage 13 years ago.

The Brookfield/GIC bid represents a c21pc premium to the business’ ($2.26) pre-bid trading price late last year. Shares were $2.79 when suspended on April 21 (continues below).

In an announcement Friday afternoon, the Canada-based giant said the acquisition expands its Australian exposure to alternative property sectors including storage, living, hospitality, logistics and office assets.

The investor has backed the acquisition through its opportunistic flagship real estate strategy.

Singapore sovereign wealth fund GIC already partnered with National Storage through an Australian joint venture before the takeover.

The pair said they would work with management to expand the platform and pursue development opportunities.

The deal comes two years since Abacus Storage King received an unsuccessful $2.2b takeover from interests linked to Nathan Kirsh and Public Storage.

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The deal – enough to require a statement to the ASX for becoming a substantial shareholder – is for 52,161,559 securities.

It provides 5.837pc voting power.

It also may influence Abacus’ shareholder register and future corporate activity (continues below).

Securities in Abacus, which recently restructured its self-storage platform, last traded at about $1 implying Charter Hall’s holding is worth c$50m though no other details regarding the terms were disclosed.

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The deal, speculated to be worth over $600 million, would give the Japan based buyer control of Australia’s and New Zealand’s largest student accommodation operator, with over 45,000 beds.

Also included is subsidiary, Essence Communities, the country’s largest white-label build to rent operator (this is a service model where a project is managed by it but branded to another company).

Samty is one of Japan’s largest accommodation operators.

The UniLodge deal is subject to foreign investment review board approval (continues below).

Samty grows within Asia Pacific

Privatised 11 months ago, supported by Hillhouse Investment’s Rava Partners and Daiwa Securities Group, Samty recently launched a hotel focused property fund. It also sold multi-family investment pools to sovereign wealth funds while staying on as manager.

“This acquisition supports Samty’s long term ambition to expand its role as a leading provider of accommodation services in the Asia-Pacific region,” president and chief executive officer, Yasuhiro Ogawa, said.

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Australia’s mean house price – not to be confused with the less statistically reliable median used in most real estate reporting – has hit seven figures for the first time, specifically, $1,002,500.

According to Australian Bureau of Statistics research released today, New South Wales continues to lead the nation with the mean price of a home in the March quarter at $1,245,900, up nearly $6000 on the December figure.

Queensland follows at $944,700 – a rise of $85,900 since last March and $419,800 since March, 2020, when the country went into lockdown.

The Sunshine state displaced ACT, now the country’s third priciest region with the average home costing $941,300, slightly down on last quarter ($942,500) and last year ($951,800).

According to the ABS, Victoria is next ($899,700), then Western Australia ($874,200), South Australia ($861,900), Tasmania ($670,200) and Northern Territory ($517,700).

Small step, giant leap

Australia’s mean house price rose $6900 for the quarter – 0.5 per cent – to reach $1,002,500.

Combined, the value of homes traded reached $11.4 trillion for the March quarter, up $130.7 billion or 1.2pc on the December, 2024, figure, the ABS said in a statement.

The number of dwellings increased too, by 53,400 to 11,338,500.

The ‘mean value’ is the average calculated by adding the numbers in a set then dividing it by the count in that set.

The median value largely circulated by privately owned groups and used extensively in real estate reporting, is the value of the middle sale in the set when arranged in ascending order.

It is considered less statistically dependable as it relies on agent or developer input – and a sizeable number of sales are missed.

Some deals do not settle either, also skewing a figure.

The ABS research released today by comparison captures all sales – including those undisclosed to private research groups – finalised with respective government departments.

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CBRE is buying smaller Melbourne-based, national commercial real estate agency rival Burgess Rawson.

The deal, speculated late last year to be worth as much as $30 million, will see the Burgess Rawson brand near cease in its 50th year.

Instead its chief executive officer, Ingrid Filmer, will lead CBRE’s Metropolitan Investments team.

The move, it is hoped, will see the US-based agency take a greater slice of the sub-$35m east coast high net worth investor segment, where Burgess Rawson has made inroads recently, especially with its bulk auction events.

Burgess Rawson offices in the ACT and Western Australia, which are independently owned, will retain the brand.

“[Burgess Rawson] manages transactions in a broad range of sectors including early education, convenience retail, fast food, healthcare, large format retail and service stations,” a spokesperson for the buyer said in a statement

“The acquisition will bring together CBRE’s and Burgess Rawson’s complementary strengths and resources to provide enhanced solutions for high-net-worth individuals, developers, owner-operators, REITs, syndicators and family offices,” they added.

Win-win: agents

Established in 1975 by Christopher Burgess and Gerald Rawson, Burgess Rawson was sold in stages in the decade to 2012 and is now held by six executives: Ms Filmer, Darren Beehag, Raoul Holderhead, Jamie Perlinger, Adam Thomas and Shaun Venables.

Across the offices which have sold – Brisbane, Melbourne, Mildura, Sydney and Townsville – it employs 80 people.

“[The agency] has spent five decades building deep trust with private investors and establishing a market – leading national platform,” Ms Filmer said.

“Joining CBRE – one of the most respected global real estate firms – gives us the scale, capability, and reach to elevate what we do best,” she added.

“This partnership allows us to connect our clients to international capital, world-class research, and broader market opportunities than ever before,” according to the executive.

CBRE Advisory Services chief executive officer, Phil Rowland, said the move allows it to “diversify into new asset types and markets, access strong leadership and broker talent and enhance its market position in what is a fragmented part of the investment sector”.

The deal should settle next month.

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The number of childcare centre sales is up – with deals worth $205 million clocked this year.

The rise in transaction value for the first quarter, the most recent information available, is 58 per cent compared to the first quarter of 2024.

With the 2025-2026 federal budget allocating over $21 billion to early learning ($16b of that, subsidies), demand specifically for the sector is being sought, agents say, often by first time investors.

“Investors are favouring secure, long-leased assets amid equity market volatility and the prospect of interest rate cuts,” Stonebridge Property Group’s Tom Moreland said.

“Childcare revenue is growing at 6.7pc annually and forecast to reach $22.3b this year,” he added.

“Tight supply, strong population growth and more parents in the workforce are driving demand,” according to the executive.

“Rising construction costs have made existing centres more attractive especially when acquired below replacement value.

“Private investors still lead activity, but institutional capital is expected to re-enter as funding conditions improve”.

Interstate, international investors back: agents

CBRE Healthcare and Social Infrastructure’s Jimmy Tat agrees, adding interstate and international investors form a greater pool of suitors than last year – more reminiscent of more buoyant times in the commercial real estate sector.

“We continue to see a strong return to investment from international capital across the country,” he said.

“The majority of our sales are occurring across states to locally based buyers who generate their wealth from Asian based business sources,” according to the executive.

“This means Queensland based investors are buying in New South Wales and Victoria while we see Victorian based buyers purchasing in other states”.

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