How to spot Melbourne's up and coming commercial suburbs


Many investors spend years building their portfolio before even considering a commercial property, while many never think about the asset class at all.

Commercial real estate, after all, is a high-risk high-reward game. Unless investors are also savvy business people, the number of factors that could affect a commercial property’s performance is likely a bit intimidating.

How a commercial property will perform, however, often comes down to one thing: location. Fortunately, there are ways to predict Melbourne’s best suburbs to invest in commercial property.

Be aware of upcoming urban planning projects

A new train stop can completely revolutionise a suburb.

In a city where everyone travels with their Myki card in hand, a new train stop can completely revolutionise a suburb.

That’s because ease of access is a hallmark of urbanisation. As new suburbs or zones become more accessible, they tend to become more popular. If you’re looking for a great location to buy a commercial property, watch out for any public works – such as train or bus lines, new parks or urban renewal projects – that could make a suburb more desired.

Where are young professionals moving to?

Cafe culture can be an excellent indicator of a suburb on the rise. To find commercial growth areas, look for new businesses opening up, especially those that might appeal to young Melburnians.

Most businesses trade with young professionals – or employ them – so be on the lookout for establishments such as:

  • Restaurants
  • Cafes
  • Bars
  • Entertainment venues
  • Health and wellness facilities
  • Offices
A rise in cafe culture can be an excellent growth indicator.

Is there room to grow?

Buying in the CBD or another super popular business district could be out of reach for most new investors as well as many commercial renters.

Instead, look for those up and coming suburbs and when you think you’ve found one, ask yourself if there’s room for new businesses in the area.

This means examining:

  • How many businesses have opened recently, as well as how many have closed. This is a good way to gauge if an area is still growing or if things are likely to slow down.
  • Does this seem to be a fairly established commercial area? Are businesses staying for a long period of time?
  • What kind of businesses are opening or closing? It’s important to understand this because it will help you see which businesses tend to thrive or fail in a given suburb, as well as if there are any unexplored markets.

Together, this should give you a comprehensive picture of the direction a suburb is headed.

Investigate whether there is room for new business in the area you are looking to buy in.

Crunch the numbers – but don’t fixate on them

Comparing recent sales and rental yields can go a long way in helping you spot a winning commercial property, but the numbers aren’t everything, so don’t fixate. There are several other ways to spot a promising commercial property in a killer location including those we describe above.

Speak to our specialist team

As Melbourne continues to expand, the northern suburbs will continue to be a hotspot for new businesses and a one-size-fits all approach won’t work for everyone.

Nelson Alexander has a specialised commercial division with a team of highly experienced and dedicated professionals. Our highly experienced team are here to ensure you achieve the best possible outcome for your commercial property requirements. We cater for a diverse range of clients including Private investors, commercial investor groups, social enterprises, government departments and small business.

Don’t miss out on our expert advice, reach out to a member of our commercial team today.

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