Managing director of Colliers International Peter Wheeler said the Ergon building on Flinders Street, Townsville was the top commercial sale of the year. PICTURE: Matt Taylor.

A TWO-speed commercial property market has been identified in Townsville in a report by Colliers International Townsville.

Over the 2018 to 2019 financial year there has been steady inquiry and lower vacancy rates for high grade commercial spaces, however there has been an excess supply of lower grade commercial property, the report found.

Managing director at Colliers International Peter Wheeler said commercial property that needed maintnence or work done was plentiful but properties that were high quality were less available and more in-demand.

“Generally speaking high grade commercial properties are modern in style, of relatively new construction and have been tastefully refurbished,” Mr Wheeler said.

“Inquiries have increased, the vacancy rate has dropped for parts of the market, and the median sales price for office and industrial properties has increased.

“Tenants have been in a strong position to go after good quality premises, leaving things a bit tougher at the lower end, where property owners are still having to offer incentives to try and attract tenants or consider refurbishing.”

Mr Wheeler said the property market still provided plenty of opportunity for businesses with an abundance of commercial spaces available at low prices.

“Current market conditions are still providing a good opportunity for local businesses to

have the chance to own their premises with affordable prices and low interest rates,” Mr Wheeler said.

“We’re also seeing continued strong interest from southern investors as the capital city markets remain overheated who are finding opportunities to get higher yield and appreciation here in Townsville.

“I really urge all commercial property owners who have what is considered to be a low grade property to refurbish them and do what they can to remain as competitive as possible in this market.”

Over $277 million in commercial property sales including office, industrial, retail and agriculture properties, took place in the 2018 to 2019 financial year.

The median commercial property sale for 2018 to 2019 was $715,000, up from $515,000 for 2017 to 2018 financial year.

The median industrial property sale increased from $500,000 to $560,000 and industrial land sales also noticeably increased for the first time in several years.