Retail has solidified its place as the most sought-after asset in Australia’s commercial market for the third consecutive year, with total spending on the sector’s properties totalling more than $13 billion in 2025.
Retail has been Australia’s most traded commercial asset for the third consecutive year, spurred on by a resurgence in investor confidence as the sector significantly outperformed its 10-year averages.
According to the Colliers Retail Investment Review and Outlook 2026, retail has continued to build on the momentum it gained since the pandemic, making it an attractive option for investors.
The retail sector recorded investment volumes of $13.16 billion in 2025, marking a 48 per cent year-on-year increase.
According to Colliers data, retail property spending in 2025 was more than $5 billion above the 10-year average.
Retail investment across Australia totalled 159 transactions, with an average sale price of $77.8 million, 20 per cent higher than the previous year.
The increase in demand across the sector saw average sales prices reach their highest point in a decade, 35 per cent above the 10-year average.
Regional shopping centres were by far the most sought-after retail assets for investors, with volumes reaching a record and surpassing the 10-year average by 175 per cent.
The level of spending on the asset class jumped significantly in 2025, reaching $6.04 billion, surpassing the combined totals for 2022–24.
Colliers said that retail assets remained an attractive option for investors, who often favoured income-secure formats such as shopping centres anchored by major grocery chains.
Demand for Australian retail properties has been supported by a greater emphasis on brick-and-mortar locations, with low online shopping appeal and high delivery costs that keep consumers interested in visiting physical stores.
CBD centres also performed very strongly, outperforming 2024 by 229 per cent, while spending on neighbourhood centres was 53 per cent above the 10-year average.
Conversely, sub-regional centres struggled to reach the benchmark set by the 10-year averages, underperforming by 141 per cent.
Similar to the residential market, competition in the retail market has been driven by a lack of supply, with Colliers reporting an expected shortfall of over 2 million square metres of retail space by 2035.
The data showed that NSW was the dominant state for commercial investor activity, accounting for almost half of the nation’s total investment, at $6 billion.
In the same span, Queensland recorded $3.7 billion, while Victoria accounted for $2.4 billion of Australia’s total investment spend in 2025.
Western Australia, South Australia, ACT, and the Northern Territory accounted for just over 5.5 per cent of transaction volume, totalling a tick under $850 million.
Institutions were the largest consumer of retail properties in 2025, accounting for 56 per cent of total transactions.
Private investors made up 23 per cent of purchases, while funds/syndicates accounted for 15 per cent of transactions.
Lachlan MacGillivray, Colliers managing director, Asia Pacific | Retail Capital Markets, said the market would likely maintain its current momentum through 2026.
“Australian retail has attracted significant capital and the sector is positioned as a standout investment destination in 2026,” MacGillivray concluded.
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