Buying commercial property is one of the most powerful moves a business owner or investor can make—but only if you go in prepared. A smart acquisition starts with smart budgeting, and too often, we see first-time investors overlook essential costs or underestimate just how capital-intensive the process can be.
At Eastview Advisory, we help clients across Australia develop clear, realistic budgets that match their goals and risk appetite. Whether you’re acquiring your first warehouse, retail unit, or office space, here’s how to avoid surprises and build a budget that supports strong, long-term performance.
What to Include in Your Commercial Property Budget
1. Deposit
Most lenders require a 20–40% deposit for commercial property acquisition, depending on the asset and your financial profile. That’s significantly higher than residential, so make sure you’re prepared for this upfront equity requirement.
2. Legal Fees
Commercial contracts can be complex. Budget $3,000–$8,000 for a solicitor with commercial property experience—this is not an area to cut corners.
3. Stamp Duty
Each state in Australia calculates stamp duty differently, and for commercial assets, it can be a significant figure. Use a current state-specific calculator and factor this cost into your cash outlay.
4. Building & Pest Inspections
Don’t skip this. Spending $1,000–$2,000 on a detailed inspection can save you from unexpected repair bills or compliance failures after settlement.
5. Buyer’s Agent & Professional Advice
Hiring a buyers agent commercial property expert ensures you’re not overpaying or missing red flags. Add in your accountant and financial planner (especially if investing through a trust or SMSF), and allocate at least $5,000–$10,000 in professional fees.
Ongoing Costs You Must Account For
1. Land Tax & Council Rates
These apply regardless of occupancy and vary state-to-state. In many cases, they can be passed on to the tenant, but not always—so review lease terms carefully.
2. Property Management
Expect to pay 5%–10% of rental income if you’re engaging a property manager. A good one will handle everything from lease compliance to maintenance, which is especially valuable if you’re not local.
3. Repairs, Maintenance & Compliance
All properties require upkeep. From air conditioning systems to roof repairs and fire safety upgrades, set aside annual reserves for capital works.
4. Insurance
Cover for buildings, public liability, and rental income interruption is essential. Premiums vary based on location and property type—so don’t estimate blindly.
Financing Considerations for Commercial Property Buyers
1. Loan-to-Value Ratio (LVR)
Banks typically lend only 60–70% for commercial properties. That means you’ll need substantial equity to get started.
2. Interest Rates & Loan Structure
Interest rates for commercial loans are generally higher and terms shorter. Make sure your cash flow projections allow for rate changes and possible refinancing.
3. Cash Flow Buffer
Always set aside extra funds for unforeseen vacancies, capital upgrades, or delayed rent payments. A 3–6 month buffer is a smart starting point.
Budget Example: Warehouse Purchase at $900,000
- Deposit (30%): $270,000
- Stamp Duty (NSW estimate): $35,000
- Legal & Inspections: $7,000
- Professional Fees: $5,000
- Initial Buffer: $15,000
Total Upfront Estimate: $332,000
Add your annual expenses like insurance, land tax, and management, and your true cost of investing in commercial property becomes clear.
Why Budgeting with a Commercial Buyers Agent Matters
When you’re making your first commercial real estate investment, having a commercial property buyers agent Australia by your side gives you a major advantage. Not only can they help you find commercial property that suits your financial plan, but they’ll guide you on:
- Hidden holding costs
- Lease terms that affect cash flow
- Tax implications
- ROI analysis and capital growth potential
Working with a commercial buyers agent ensures that you’re not just buying what looks good—but investing in what works.
Planning to buy commercial property in Sydney, Brisbane, Melbourne, Adelaide, or anywhere in between? At Eastview Advisory, we offer buyer advocacy across Australia, helping clients navigate every financial, legal, and practical consideration with confidence.
Book a strategy session today and get clarity on what’s possible with your budget, goals, and timeline. Your first investment starts here—with insight, not guesswork.
