Queensland Commercial Property Weekly Wrap-Up

Week Ending 20 March 2026

The Queensland commercial property market is currently navigating a period of high-conviction investment set against a backdrop of increasing construction cost pressures. Transactional activity this week has been dominated by a "flight to quality" and "fear of missing out" (FOMO), particularly within the Brisbane CBD office sector and prime coastal retail strips. While record construction activity of $318 billion was noted nationally last year, emerging geopolitical tensions and a 5-6% forecast increase in Queensland building costs are beginning to weigh on project feasibilities, further elevating the value of established, income-producing assets (The Courier-Mail, 2026; Wilmot, 2026).

Weekly Transaction Summary

Development – Bloom Tower Site, Auchenflower

355 Coronation Drive and 6 Lang Parade, Auchenflower

A 1,430 sqm riverfront corner site has been secured by Joe Adsett Developments for $15 million. The unconditional sale paves the way for "Bloom Tower," a 23-storey luxury residential project featuring 90 apartments with an estimated completion value of $250 million. The site was fully leased at the time of sale, providing a gross holding income of approximately $273,260 per annum. The campaign’s intensity, featuring over 150 inquiries, underscores the significant appetite for blue-chip residential land within 1.5km of the Brisbane CBD (Herde, 2026).

Office – Gold and Blue Towers, Brisbane CBD

10 & 12 Eagle Street, Brisbane City

Marquette Properties has successfully leased 17,030 sqm across 21 separate transactions within the Gold and Blue towers over the last six months. Key commitments include CIMIC (8,100 sqm) and MOORE Group (1,800 sqm). Rental rates for the Gold Tower ranged from $1,075/sqm to $1,095/sqm gross, while the Blue Tower and Annex achieved between $1,095/sqm and $1,250/sqm. This activity indicates a tightening market where tenants are moving quickly to secure space ahead of major infrastructure completions like Cross River Rail (The Courier-Mail, 2026).

Retail & LFR – Sails Restaurant, Noosa Heads

75 Hastings Street, Noosa Heads

In a major hospitality play, a private investor has purchased the beachfront property housing Sails Restaurant for $15.3 million. The deal reflects a 4.66 per cent yield for the 460 sqm asset, which is secured by a long-term net lease with options extending to 2045. Noosa remains one of the most tightly held markets in the country, with this iconic Hastings Street asset attracting 186 inquiries from national and international buyers (Herde, 2026).

Retail & LFR – North Rise Shopping Village, Deception Bay

1-7 Mariner Boulevard, Deception Bay

The IGA-anchored North Rise Shopping Village has been sold off-market to a Sydney-based investor for $4.15 million at a 4 per cent yield. The 1,099 sqm centre, situated on a 5,083 sqm site, has seen a value increase from its $3.5 million purchase price in 2020. Located in the Moreton Bay growth corridor, the asset’s diverse mix of medical and essential services continues to drive investor interest in neighbourhood retail (Herde, 2026).

Retail & LFR – Bicycle Riders Building, Morningside

600 Wynnum Road, Morningside

A prominent 232 sqm retail freehold has sold to a local investor for $1.56 million, representing a super-tight yield of 3.48 per cent—the sharpest commercial yield recorded in 2026. The property, tenanted by Bicycle Riders for over 20 years, was sold on behalf of St Vincent de Paul Society Queensland. The rapid 10-day campaign highlighted the depth of demand for main-road retail investments in Brisbane’s middle-ring suburbs (The Courier-Mail, 2026).

General News

• Townsville North Rail Yards Transformation: The Queensland Government has unlocked $35 million for the remediation and heritage stabilisation of the 4.5ha North Rail Yards site. Impact: This investment clears the primary financial hurdle for a high-density hub featuring 319 apartments, significantly boosting commercial and residential density in the Townsville CBD (Smith, 2026).
• Construction Cost Projections: Rider Levett Bucknall (RLB) forecasts a 5% to 6% rise in construction costs across Brisbane, the Gold Coast, and Townsville in 2026. Impact: Escalating costs for steel, cement, and bitumen, compounded by skilled labour shortages, are likely to delay secondary project starts, further tightening supply in the premium office and residential sectors (Wilmot, 2026).
• Geopolitical Volatility: Rising tensions in the Middle East have introduced upside risks to freight and oil prices. Impact: For the commercial industry, this translates to higher logistics costs and potential material delays, prompting developers to focus on "unconditional" and "development-ready" sites to mitigate timing risks (Wilmot, 2026).

Final Take

This week’s activity reinforces a clear trend: capital is gravitating toward assets with long-term lease security or irreplaceable location credentials. The record-low yields in Morningside and the high inquiry levels for Noosa and Auchenflower sites suggest that despite a 5-6% construction cost escalation forecast, the "top end" of the Queensland market remains robust. As Brisbane's CBD vacancy continues to tighten, the focus is shifting toward supply delivery and the preservation of heritage assets as seen in Townsville.

References

• Herde, C. (2026, March 13). Investor Sails into Noosa with beachfront purchase. The Courier-Mail.
• Herde, C. (2026, March 13). Retail Rise lures buyer. The Courier-Mail.
• Herde, C. (2026, March 13). Sale sparks new tower. The Courier-Mail.
• Smith, L. (2026, March 17). Platform for future growth in rail yards. Townsville Bulletin.
• The Courier-Mail. (2026, March 13). Bicycle retailer to stay.
• The Courier-Mail. (2026, March 13). Tenants in a rush for space.
• Wilmot, B. (2026, March 19). Construction at record level but problems build. The Australian.