Commercial Finance Update Sept 26

Tristan Holroyd - Manager - Specialist Finance Broker

The WA commercial market remains active, particularly for good-quality industrial, warehouse and well-located commercial assets. Strong properties with quality tenants and realistic pricing are still attracting buyers quickly.

However, describing the entire commercial market as being at an all-time high may be too broad. WA commercial transaction volumes fell 34.4% in FY26 to approximately $3.19 billion, although industrial property remained the largest and most resilient sector. Buyers are still active but they are taking longer to complete due diligence and are paying closer attention to tenant quality, property condition and funding costs. Ray White Commercial WA

At the same time, we are seeing potentially workable transactions fall over with the banks because they have not been structured or presented properly. Commercial lending requires the banker or broker to understand:

• The borrower’s business and industry.

• Historical and forecast cashflow.

• The purpose of the funding.

• The property or asset being offered as security.

• Lease terms and tenant strength.

• The ownership and borrowing structure.

• The client’s contribution and liquidity.

• The repayment strategy and eventual exit.

A good commercial deal is not simply a property with a low loan-to-value ratio. It is a transaction where the borrower, cashflow, security, loan structure and exit strategy all make sense together.

We are seeing more business owners considering an exit. Some are winding down operations, while others are preparing their businesses for sale because of rising costs, increasing regulatory requirements, staffing pressures, fatigue or succession issues.

The challenge STRATOSFEAR often sees, is owners often wait until performance has already deteriorated before seeking advice when planning to sell. This can reduce the value of the business and make it harder for a purchaser to obtain finance. The strongest outcomes generally occur when owners begin preparing two or three years before the intended sale. This allows time to strengthen profitability, improve reporting and reduce reliance on the owner.

The overall WA market still presents substantial opportunity. However, successful transactions increasingly depend on experience, preparation and getting the structure right from the beginning.

Contact tristan.holroyd@stratosfear.com.au to discuss your specific scenarios.