Newcastle’s commercial property market has shifted significantly over the past 18 months, and momentum heading into 2026 suggests the next five years will be defined by specialised demand, tightening supply in key sectors, and evolving occupier preferences. Based on the latest local market data and industry trends, here’s a closer look at where retail, office and industrial property in Newcastle and the Hunter are heading.

Office Market: Rising Occupancy and Flight to Quality

Newcastle’s office sector has been one of the strongest regional performers in NSW. According to the latest Property Council Office Market Report, vacancy in Newcastle fell to around 14.9% in early 2025, driven by nearly 8,000 sqm of net absorption as more space was leased than vacated.

Demand is increasingly concentrated in A-grade and modern office buildings, while older D-grade stock continues to struggle without refurbishment. Local leasing activity also reflects this shift, with growing enquiry for smaller, flexible floorplates (150–300 sqm) alongside demand from corporate tenants with central lease expiries.

Looking forward:
✔ Continued uptake of efficient, high-quality office space
✔ Office tenure shaped by hybrid working (smaller footprints, higher amenities)
✔ Ongoing investor interest in well-leased, modern assets

Thinking about leasing, repositioning or investing in office space?
Our commercial team can provide tailored advice on current demand, achievable rents and asset positioning across Newcastle’s office market.

Retail: Stabilising with Mixed Dynamics

Retail markets in Newcastle are finding balance between challenging conditions and targeted opportunity. While cost-of-living pressures and rising operational expenses continue to influence tenant decision-making, well-located, experience-driven retail assets remain in demand.

Neighbourhood and convenience centres with strong tenant mixes are outperforming traditional strip retail. Independent operators, food and beverage venues and destination-led retail — particularly in areas with strong foot traffic and lifestyle amenity — are driving leasing activity.

Looking forward:
✔ Continued demand for experience-led and service-based retail
✔ Stronger enquiry for adaptable lease terms and flexible layouts
✔ Owner-occupiers targeting neighbourhood retail with solid local catchments

If you’re reviewing a retail lease, acquisition or exit strategy, our commercial specialists can help assess demand, tenant mix and long-term performance potential.

Industrial: Strong Fundamentals, Tight Supply

Industrial property remains the standout performer across Newcastle and the Hunter — and all indicators suggest this strength will continue.

A tight supply of industrial land, combined with sustained demand from logistics, manufacturing and trade-based occupiers, has underpinned strong leasing conditions. Key industrial precincts such as Beresfield, Rutherford and surrounding hubs remain highly sought after for both strata units and larger facilities.

Structural supply constraints — particularly a lack of development-ready land — are expected to place continued upward pressure on rents and reinforce investor demand for well-located industrial assets, especially those connected to major transport routes and port infrastructure.

Looking forward:
✔ Ongoing competition for quality industrial stock
✔ Shorter vacancy periods across strata and traditional formats
✔ Continued investor focus on secure, long-leased industrial assets

Considering leasing, selling or acquiring industrial property?
Our commercial team can provide up-to-date insights on availability, pricing and demand across Newcastle’s key industrial precincts.

Investment & Capital Flows: Growing Interest Beyond the Region

Investor enquiry is broadening beyond the local market, with interstate buyers — particularly from Sydney and Brisbane — increasingly assessing Newcastle for its relative affordability, strong fundamentals and long-term growth outlook.

Secure income-producing assets remain a key focus, with investors prioritising lease security, tenant covenant strength and long-term adaptability across retail, office and industrial property.

Key Trends Shaping the Next 5 Years

Based on current trajectories, Newcastle’s commercial property market over the next half-decade is likely to be shaped by:

• Strong occupier preference for quality office stock and flexible space
• Continued outperformance of industrial and logistics assets
• Retail stabilising around experience-led and convenience formats
• Growing interstate investor interest in defensible assets
• Infrastructure and population growth reinforcing long-term fundamentals

Final Thoughts

Newcastle isn’t just evolving — it’s redefining its commercial property identity. Across office, retail and industrial sectors, the market is becoming more specialised, with outcomes increasingly driven by asset quality, location and adaptability.

For investors, occupiers and property owners considering their next move, local insight matters more than ever. Understanding what’s happening on the ground — not just at a headline level — is key to making confident, future-focused decisions.

If you’re considering leasing, investing or repositioning a commercial asset, speak with MOVABLE’s Commercial Team.
We offer tailored, local advice backed by real market activity across Newcastle and the Hunter.