Are You Aware of the Absentee Owner Surcharge?

AS OF 1 JANUARY 2017, Victorian land owned by an “absentee owner” is subject to an additional 1.5% Absentee Owner Surcharge.  The purpose of the surcharge is to require foreign buyers, who do not pay other taxes, to contribute to government services and infrastructure in Victoria.

Although this surcharge also applies to commercial property, it was originally introduced as an attempt to manage foreign purchasing of residential real estate in Victoria – to assist with housing affordability. [Read more…]

Where in the Cycle are the CBD Office Markets?

EVERY INVESTOR would like to be in a position to pick the top and bottom of each Cycle, when it comes to commercial property.

And if you had followed things closely during last century, you would know forecasting this used to be relatively straightforward  with all the various Office markets following a fairly predictable sequence, as shown below. [Read more…]

6 Ways to Enjoy Your Extra Cash from Depreciation

AS AN A INVESTOR, once you start claiming depreciation, you’ll notice a big improvement in your cash flow.

That’s because depreciation effectively lowers taxable income – and that means more money back in your pocket come tax time.

For most investors, the extra cash goes into savings. Or is put towards a holiday, or a new car. Or simply used for everyday living expenses.

However, there are far smarter ways to use the extra cash you gain from depreciation. And here are just a few. [Read more…]

Capital City Office Markets Around Australia

AS I EXPLAIN to my Mentor group, there is a certain rule of thumb for Office market vacancies around Australia.

And it’s really quite simple: For an office market to be “in balance” you really need to have a vacancy rate of between 6% to 8%.

It’s a bit like the unemployment rate. You see … a 5% unemployment rate – effectively means FULL employment – because anything lower than this … is starting to put pressure on wages. [Read more…]

Freehold Vs Leasehold – What Does This Mean for Depreciation?

LET’S USE HOTELIERS as an example. When they request a tax depreciation schedule for their property, there are usually three main scenarios:

  1. Freehold, which is where the client owns the building only, not the business that operates from it.
  2. Leasehold, where the client owns the business only, not the actual property.
  3. The client owns both the business and the building.

[Read more…]

4 Things to Consider When Fixing Your Interest Rate

WHEN INVESTING IN Commercial property, one of the major attractions for investors is the cashflow available. And locking in a guaranteed cashflow, via fixing your loan can be an attractive strategy.

However, there are a number of things that should be considered, before deciding to fix your interest rate. Here are some of the most important questions to ask yourself when deciding. [Read more…]

Super Funds Are Dominating Commercial Property

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DID YOU KNOW super fund members are some of the biggest landlords in our capital cities?

They own a share of offices, hotels, warehouses and shopping centres. The more cash in super funds, the more properties are bought – indirectly exposing fund members even to some of the most iconic office towers in capital cities. [Read more…]

5 Tax-time Tips for Commercial Property Owners


With tax time upon us, many property investors will be preparing to visit their Accountant to complete their annual income tax assessment.

Getting your tax in order can be a confusing task at the best of times, but when you’ve got a commercial investment property, it can get even more complex. [Read more…]

Purchase a Commercial Property Wisely Through Your SMSF 

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THE HIGHER RENTAL RETURNS of commercial property make it more attractive to investors, especially those who are planning for their retirement. They often buy and hold commercial properties in their SMSF for a better tax environment. [Read more…]

Why You Should Have Your Commercial Lease Prepared by Professionals


QUITE OFTEN THE QUESTION will arise, as to whether you need incur the cost of having a lawyer to prepare your commercial lease. And perhaps the answer is best found in this case study. [Read more…]

How The Royal Commission Will Affect Bank Lending


SINCE DECEMBER of last year, the Federal Government has been conducting a Royal Commission into the banking industry, as well as financial and superannuation services in general.

Some areas covered so far (relating to lending practices) have included commission structures for brokers and staff, as well as cash incentives being offered by banks. [Read more…]