Foreign Investment Fuels Commercial Property Growth

Foreign investment is continuing to play an important role in Australia’s commercial property market, with offshore buyers remaining active across office, industrial, retail, hotel and other major asset classes.

Recent CBRE data show that Australian commercial property transaction volumes reached $19 billion in the first half of 2026, up 16% on the same period a year earlier. Across the broader Asia-Pacific region, commercial real estate investment also increased strongly, rising 27% year-on-year in the first half of 2026 despite higher interest rates and global economic uncertainty.

Foreign capital remains particularly important in Victoria. Realcommercial.com.au reported that offshore Asian investors have been increasingly targeting Victorian commercial property, with Melbourne attracting interest from buyers looking for comparatively better value than some parts of New South Wales and Queensland. Cushman & Wakefield also reported that offshore Asian capital accounted for about 55% of its Victorian investment sales transactions in 2025.

For Melbourne’s western growth corridor, stronger commercial investment could have wider implications beyond individual property transactions. New industrial estates, logistics facilities, retail centres, offices and mixed-use developments can support employment growth, increase demand for local services and contribute to infrastructure and amenity improvements.

These benefits can also influence residential property markets over time. When commercial investment brings additional businesses and employment opportunities into an area, workers may choose to live closer to their workplaces, potentially supporting demand for housing in surrounding suburbs.

Melbourne’s west is already an important logistics and industrial region because of its access to major road networks, freight infrastructure and large areas of developable land. Continued investment in commercial property could therefore strengthen the broader economic base of growth areas while supporting new jobs and services.

However, it is important to distinguish between commercial and residential investment trends. Strong offshore demand for offices, warehouses or retail properties does not automatically translate into higher residential property values. Housing prices will continue to be influenced by factors such as interest rates, borrowing capacity, population growth, housing supply and local affordability.

For residential investors, commercial development can nevertheless be an important factor when assessing a suburb’s long-term potential. New employment precincts, shopping centres, business parks and infrastructure projects can improve the overall attractiveness and functionality of a local area.

Foreign investment can also provide capital for large developments that may otherwise take longer to proceed. This can help deliver new commercial facilities, employment opportunities and services in rapidly growing communities.

For Melbourne’s western growth corridor, the continued flow of international capital into Australian commercial property is therefore worth watching. While the immediate impact is concentrated in the commercial sector, sustained investment could contribute to stronger local economies, improved amenities and increased employment across some of Melbourne’s fastest-growing areas.

Overall, offshore investors remain an important source of capital in Australia’s commercial property market. For Melbourne’s west, the long-term opportunity may come from the broader economic activity that commercial development creates rather than from commercial investment directly influencing residential prices.