In commercial property, the lease is often the most valuable asset.

Two properties with the same advertised rent can deliver very different results depending on:

• Who pays outgoings and repairs

• Rent-free periods and incentives

• Fixed increases vs CPI or market reviews

• Lease term, options, and expiry profile

• Make-good obligations at the end of the lease

These details directly affect cash flow certainty, vacancy risk, and long-term returns.

The performance of a commercial property isn’t just about the building — it’s about how it’s used.

Different uses can significantly change:

• Maintenance and wear-and-tear

• Compliance and safety obligations

• Services capacity (power, HVAC, plumbing)

• Fit-out costs and replacement cycles

• Downtime when a tenant leaves

A warehouse used for storage behaves very differently from one used for manufacturing or food processing — even if they look similar on paper.

Capex is one of the biggest reasons commercial property results vary.

Two owners may both spend similar amounts, but outcomes differ depending on:

• Whether the work improves leasing demand

• If upgrades are compliance-driven or cosmetic

• Timing of spend relative to lease expiry

• Risk of overcapitalising for the local market

Well-planned capex can improve income security and leasing speed.
Poorly planned capex can reduce cash flow without improving returns.

Commercial property outcomes are heavily influenced by timing, including:

• When a lease expires

• When refinancing occurs

• When major upgrades are required

• Market conditions at rent review points

Two owners can hold similar buildings for the same period and experience very different results simply because key events happen at different times.

Strong-performing commercial assets are rarely “set and forget”.

Performance improves with:

• Proactive lease renewals

• Careful tenant selection

• Flexible space design

• Preventative maintenance

• Cost control and service optimisation

Good management reduces surprises and protects long-term value.

Even when two properties look commercially similar, after-tax outcomes may vary due to:

• Ownership structure (company, trust, SMSF)

• Timing of capital works and asset commissioning

• What is owned by the landlord vs the tenant

• Depreciation eligibility and treatment

This is where proper tax planning and depreciation analysis become critical.