In Western Australia, the Commercial Tenancy (Retail Shops) Agreements Act 1985 governs the leasing of retail shops. This legislation outlines the rights and obligations of landlords and tenants, covering aspects such as lease agreements, rent reviews, disclosure requirements, security bonds, and dispute resolution processes. The Act aims to promote fairness and transparency in retail leasing transactions. Both landlords and tenants must understand and comply with this legislation to protect their legal interests and ensure smooth leasing arrangements.
The Planning and Development Act 2005 provides the framework for land use planning and development assessment in Western Australia. Local governments administer Local Planning Schemes that designate zoning regulations, land use categories, and development standards within their jurisdictions. Commercial property developments must comply with these schemes, obtaining necessary development approvals and adhering to zoning requirements that dictate permissible uses of land. The Western Australian Planning Commission (WAPC) oversees state-level planning policies and approvals for significant developments.
Building work in Western Australia is regulated under the Building Act 2011 and the Building Regulations 2012. All building work must comply with the National Construction Code (NCC) and relevant Australian Standards to ensure safety, health, and amenity for occupants. Builders and developers are required to obtain building permits from permit authorities (usually local governments) before commencing construction. Compliance is essential to guarantee that buildings are safe for occupancy and meet required design and construction benchmarks.
RevenueWA, a division of the Department of Finance, administers stamp duty (referred to as transfer duty in Western Australia) and land tax. Transfer duty is payable on dutiable transactions, including the transfer of commercial property, calculated based on the property's dutiable value. Land tax is an annual tax levied on owners of land as of 30 June each year, applicable if the total taxable value of their land holdings exceeds the land tax threshold. Investors should factor these taxes into their financial planning when purchasing commercial property.
The Environmental Protection Act 1986 governs environmental protection in Western Australia. Commercial developments may require environmental assessments and approvals, especially if they are likely to have significant environmental impacts. Developers may need to obtain approvals from the Environmental Protection Authority (EPA) and comply with specific conditions to mitigate environmental harm. Compliance with environmental regulations is essential to avoid penalties and ensure sustainable development practices, including managing pollution, waste disposal, and protecting natural resources.
Foreign investors must comply with the Foreign Acquisitions and Takeovers Act 1975 and obtain approval from the Foreign Investment Review Board (FIRB) when acquiring commercial property in Australia. As of 2023, thresholds vary depending on the type of investor and the property's value. Generally, foreign investors need FIRB approval for commercial property acquisitions over $281 million, but lower thresholds apply for sensitive properties or when the investor is from a country without a free trade agreement with Australia. It is crucial for foreign investors to consult FIRB to determine specific obligations and ensure compliance with Australia's foreign investment policies.
The WA Industry Participation Strategy aims to provide local businesses with opportunities to participate in government contracts and projects. While not directly related to commercial property, the strategy encourages economic growth and can indirectly benefit commercial property markets by stimulating business activity.
The Investment Attraction and New Industries Fund (IANIF) supports the growth and diversification of Western Australia's economy by attracting investment and fostering new and emerging industries. The fund provides financial assistance and incentives for projects that create jobs and contribute to the state's economic development. Businesses investing in commercial property as part of their expansion or establishment in Western Australia may benefit from this fund.
Western Australia offers payroll tax exemptions and rebates to eligible businesses, particularly those creating new jobs or operating in regional areas. These incentives can reduce operating costs for businesses expanding their workforce and occupying commercial premises.
Royalties for Regions is a program that invests in projects to build infrastructure and promote economic development in regional Western Australia. Grants and funding are available for projects that benefit regional communities, potentially including commercial property developments that support local economies.
The Clean Energy Future Fund supports the implementation of innovative clean energy projects in Western Australia. Businesses undertaking energy-efficient upgrades or renewable energy installations in commercial properties may be eligible for funding, leading to reduced operating costs and improved environmental performance.
Perth's office market has experienced fluctuations due to changes in the resources sector and broader economic conditions. As of 2023, the office vacancy rate in Perth CBD remains relatively high compared to other capital cities, influenced by previous downturns in the mining sector. However, there are signs of recovery with increased activity in the resources industry and growth in other sectors such as technology and professional services. Tenants are seeking modern, high-quality office spaces with amenities that support employee well-being and flexible work arrangements.
The industrial property sector in Western Australia is performing strongly, driven by the resources industry, logistics, and manufacturing. Areas such as Kewdale, Welshpool, Canning Vale, and Jandakot near Perth, as well as regional centres like Karratha and Port Hedland, are experiencing high demand for industrial properties. The growth in e-commerce has also increased the need for warehousing and distribution facilities. Low vacancy rates and steady rental growth make industrial properties attractive for investors and developers.
The retail property market in Western Australia faces challenges similar to other states, with changing consumer behaviours and the rise of online shopping impacting traditional retail formats. However, suburban shopping centres and retail strips have shown resilience, benefiting from local shopping trends. The tourism sector contributes to retail activity in areas like Fremantle and Margaret River, supporting hospitality and specialty retail businesses. Retail centres that focus on providing experiences, dining, and entertainment are better positioned to attract customers.
There is growing interest in alternative commercial property assets such as healthcare facilities, aged care, education, and mining-related infrastructure. Western Australia's ageing population supports demand for aged care and retirement living developments. Additionally, the state's strong mining and resources sector drives demand for worker accommodation and support services in regional areas. Data centres and renewable energy projects are also emerging as attractive investment opportunities.
Emu Money has a panel of 50+ lenders, including specialist lenders for commercial property. We can help you find the right lender for your needs.
Australia's major banks—ANZ, NAB, Commonwealth Bank, and Westpac—provide commercial property financing solutions with dedicated business banking specialists. They offer various loan products and financial services to support commercial property investments.
Firms like BDO, PwC, Deloitte, KPMG, and EY provide tax advisory, due diligence, financial planning, and audit services for commercial property investments.
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