TL;DR: Commercial property can provide stronger returns and longer leases compared to residential investments. Location, tenant strength, and careful due diligence are key to minimising risks and ensuring steady income over the long term.
Key Takeaways:
There’s a lot of buzz about Perth’s commercial property scene lately, and for good reason.
From established business precincts to up-and-coming industrial zones, more investors are shifting their focus from residential to commercial as they chase better returns and stronger long-term value.
Commercial property appeals to many investors because it can offer better returns and more predictability.
You’ll often see higher rental yields, longer lease terms, and far fewer issues compared to dealing with residential tenants.
If you’ve been thinking about jumping in, this guide breaks it down without the jargon.
We’ll also tell you where to start and how to avoid rookie mistakes.
Commercial properties typically offer net rental yields of 5% to 8%, while residential usually sits around 3% to 4%.
That difference can mean thousands of dollars more in annual income for the same value of property.
Retail shops can be excellent earners when they are in busy, high foot traffic locations, but they can also struggle when consumer spending slows down.
Industrial spaces like warehouses are in high demand, especially with the continued growth of online shopping, making them a strong option for many investors.
Office spaces are a little more complex. Hybrid work has reshaped demand, yet smaller suburban offices and specialised spaces are still showing solid potential for the right buyers.
The old saying still rings true: always buy in a good spot. In Perth, that often means being close to key logistics hubs, major arterial roads, or established commercial zones such as Osborne Park or Canning Vale.
These areas not only attract stable tenants but also tend to hold their value better over time.
Check council zoning and future development plans before making a move.
For more insights on how wider property trends can influence your decisions, see our article on why understanding property market trends is crucial for homebuyers and investors.
Unlike residential agreements, commercial leases come with many more moving parts.
Terms such as rent reviews, responsibility for outgoings, and make-good clauses at the end of a lease can have a big impact on your costs and returns, so it pays to understand them clearly.
If you don’t know what those are, get help before signing anything.
Vacancy rates in some parts of Perth have been climbing, and that should be a red flag for any investor.
A low price tag might look tempting, but it doesn’t always translate into a smart purchase.
Without proper research you could end up with a property that sits empty for months, draining your cash instead of building your wealth.
Buying commercial real estate without a buyer’s agent is a bit like skydiving without an instructor: you might get through it, but the risks are far higher than they need to be.
An experienced professional can help you understand the true value of a property, negotiate fairer terms, and open doors to off-market opportunities you wouldn’t normally have access to on your own.
If you’re weighing up whether to work with a buyers agent or go it alone, this guide can check out our article on working with a buyers agent vs buying on your own
Are they paying market rent, or is it above or below what similar properties achieve? How much time is left on the lease, and does the tenant have a solid trading record you can rely on?
The answers to these questions will give you a clearer picture of the property’s stability and can ultimately make or break your investment decision.
Always arrange a professional building inspection so you know exactly what you’re buying into.
At the same time, check zoning laws with the local council to be sure the property’s current and future use is compliant.
It’s also worth asking about any upcoming roadworks or nearby developments.
Projects like these can either add to the property’s value or create disruptions that hurt your investment.
Think about whether this property will still hold its value and purpose a decade from now.
A warehouse in a well-connected area, for instance, is likely to stay useful as demand for storage and logistics keeps growing.
A CBD office, on the other hand, could face challenges if flexible and remote work trends continue to reshape how businesses use space.
It’s not just about the property itself. A tenant’s ability to pay rent on time and maintain their business matters just as much.
Review their financial health, check for any history of missed payments, and understand the type of business they operate.
A reliable tenant can provide steady income, while a risky one could leave you with unexpected vacancies.
Getting finance for commercial property is not the same as taking out a home loan. Banks look closely at the type of property, the strength of the lease, and the tenant’s history before approving finance.
It’s important to speak with a broker or lender who understands commercial lending in Perth.
They can explain loan terms, interest rates, and help you structure finance in a way that supports your long-term goals.
If you’d like to better understand how expert guidance can save you money and stress, check out our article on comparing buyers agents and self-buying.
Commercial property investment in Perth is competitive, but with the right support, you can avoid costly mistakes and uncover better opportunities.
Rise Property Buyers works solely for buyers, offering independent advice and tailored strategies based on deep local knowledge.
Our only goal is to secure the best outcome for you. From sourcing and evaluating off-market deals to negotiating favourable terms and managing due diligence, our team is with you at every step.
Book a free strategy session with Rise Property Buyers today.
We’ll show you where the smart money is going and help you build a portfolio with real potential.
We’re based in Perth and work exclusively for buyers, not sellers or developers, so your interests come first.
