Why Commercial Property Isn't Following the Residential Market

For months, Australia’s property conversation has centred on falling house prices, higher interest rates and the impact of the Federal Budget on investors.

But according to Melbourne buyers’ advocate Abdullah Nouh, many investors expecting commercial property to follow the same path are overlooking what’s actually happening across the market.

“The biggest mistake investors are making is treating commercial property as one market that moves in one direction at one time,” Nouh says.

“Office towers, neighbourhood medical centres, industrial warehouses and childcare centres all respond to completely different supply and demand dynamics.”

Rather than experiencing a broad downturn, he says that parts of the commercial market continue to perform strongly, particularly sectors supported by essential services and with limited new supply.

Neighbourhood retail centres anchored by supermarkets and medical services have proven more resilient than many expected, while industrial property continues to benefit from tight supply in most major cities.

Medical centres, childcare assets and other essential service properties are also attracting sustained tenant demand despite higher borrowing costs.

Office markets, however, are telling a different story.

Premium buildings in well-connected locations are beginning to stabilise, Nouh says, while secondary office stock in oversupplied precincts continues to face pressure.

“This isn’t a story about commercial property going up or going down,” he says.

“It’s a story about asset selection mattering more than the headlines.”

The changing market is also altering the questions investors are asking.

Rather than focusing solely on buying another residential investment property, Nouh says more investors are now looking for higher rental income and improved cash flow.

“Instead of asking how to buy another investment property, investors are increasingly asking how they can generate more income from their portfolio,” he says.

He believes commercial property has become part of that conversation because it can deliver stronger rental returns while still offering long-term capital growth when quality assets are selected carefully.

However, Nouh warns investors against assuming every commercial property represents a sound investment simply because it offers a higher yield.

“I’ve seen commercial properties remain vacant for years because they’re in locations with weak business activity,” he says.

“A high yield isn’t necessarily evidence of a good investment. Sometimes it’s evidence of the opposite.”

Instead, he says investors should focus on the same fundamentals that have always underpinned successful commercial acquisitions, including tenant demand, constrained future supply, location quality and whether another tenant would readily occupy the property if the existing lease expired.

“The lease and the tenant both matter,” Nouh says.

“But neither replaces buying a quality asset in a quality location.”

As investors continue to assess the outlook for property following this year’s Budget changes, Nouh believes the biggest opportunity may lie in recognising that commercial property is not a single market.

“Property has never moved as one market,” he says.

“The better question isn’t whether commercial property will fall in the short term. It’s which assets are likely to be in greater demand over the next decade, and whether today’s market creates an opportunity that looks obvious in hindsight.”

For Jack Freeman, a compelling interior should not look as though it was completed in a single shopping trip.

The founder and designer behind FREEMAN & CO prefers rooms that develop through art, travel, commissioned furniture and objects collected over time. It is an approach that treats the home less as a decorative project and more as an evolving portrait of its owner.

“I am a true believer in collecting versus decorating,” Freeman says.

That distinction underpins the international practice he has built across private residences, hotels, property developments, yachts and private aviation. Its projects stretch from Point Piper, Vaucluse, Circular Quay and Toorak to Mayfair, Bel Air and the Caribbean.

Although the locations and architecture vary considerably, the work is connected by a restrained design language. Natural stone, warm timbers and sculptural furniture establish the foundation, while art, bespoke lighting and individual objects give each interior its identity.

The objective is not to overwhelm a room with obvious symbols of expense. It is to create an environment that feels calm, layered and particular to the people living within it.

“The greatest luxury isn’t about excess,” Freeman says. “It’s about creating an oasis where you come home and feel immediately grounded — effortlessly chic and deeply personal.”

Collecting instead of decorating

Decorating can imply the completion of a room: selecting the required furniture, filling the available walls and producing a coherent finished image.

Collecting is less conclusive.

A collected interior has room to change as its owners travel, discover artists, inherit pieces or reassess how they use their home. Its character comes from the relationship between objects rather than adherence to a single brand or season.

That does not mean placing unrelated pieces together without discipline. The designer must understand scale, proportion, material and provenance well enough to create a dialogue between them.

A contemporary artwork might sit beside a historic piece of furniture. A precisely detailed new interior may be interrupted by an irregular object made by hand. Smooth stone can be balanced by timber, textiles or a patinated metal surface that becomes richer with age.

The tension between those elements is part of the appeal.

For Freeman, art is not an accessory to be added once the furniture plan is complete. It forms part of the architecture and atmosphere of the room from the beginning.

Lighting is considered in the same way. Beyond its practical purpose, a bespoke fitting can operate as a suspended sculpture, changing both the room’s composition and the way its materials are experienced after dark.

A design perspective shaped by travel

International travel plays a significant role in Freeman’s creative process.

Design fairs such as PAD Paris and Salone del Mobile in Milan provide opportunities to encounter emerging designers, established galleries, new materials and collectible furniture away from the filter of social media.

More spontaneous discoveries can prove equally important.

“Sometimes it’s the simple things,” Freeman says. “That piece found on a shopping trip with a client in Paris, stumbling across an artisan’s workshop, or a special memory that forms the narrative of the story.”

Objects selected during travel bring more than visual interest into a home. They carry an association with a place, maker or experience, giving the client a connection that cannot be reproduced by ordering an entire interior from a catalogue.

Freeman’s influences are international, but his projects are not conceived as replicas of Parisian, Milanese or Californian style. Each commission responds to its architecture, setting, natural light and the daily lives of its occupants.

A waterfront Sydney residence demands a different treatment from a Mayfair townhouse. A Caribbean estate shaped by brutalist architecture and reflecting pools calls for another response again.

The designer’s role is to absorb those references without allowing them to overwhelm the individual qualities of the property.

Designing the complete experience

FREEMAN & CO extends beyond conventional interior decoration.

The practice’s stated services include interior design and architecture, project management, property acquisition, development advice, concept design, documentation, furniture and lighting design, procurement and art curation.

That breadth allows the team to become involved before a room’s dimensions and finishes are fixed.

Early participation can be important at the top end of the residential market, where architecture, landscape, interiors, technology and art must operate as one environment. Decisions about ceiling heights, wall dimensions, sightlines and lighting can directly affect where art is installed or how custom furniture is proportioned.

The practice can then carry those decisions through to procurement and final installation, maintaining the design narrative as a project moves between architects, builders, specialist craftspeople, dealers and suppliers.

Its residential portfolio includes a South Coast retreat conceived as an escape from urban life, a Caribbean estate with reflecting pools, an East Coast-inspired Palm Beach residence and a Mayfair townhouse organised around an expressive drawing room.

The studio also says it has worked on highly tailored Sydney residences with values exceeding $100 million, although the private nature of such commissions means individual addresses and clients are not always disclosed.

A home that can keep changing

The risk in creating a perfectly resolved interior is that it can become too static — a composition that looks exceptional in photographs but leaves little room for life.

Freeman sees the home as something that should evolve with its owners.

“I love the evolution of design,” he says. “We are talking about people’s lives, and as they evolve, so too should their private sanctuaries.”

That evolution might involve adding art, reupholstering a significant piece, adapting rooms as a family changes or making space for objects gathered through future travels.

The original design needs to be strong enough to accommodate those layers.

This may be the clearest expression of Freeman’s approach to luxury. It is not simply access to rare stone, collectible furniture or commissioned craftsmanship. It is the creation of a personal environment whose meaning deepens rather than diminishes with time.

Fact box

Designer: Jack Freeman

Role: Founder and managing director

Practice: FREEMAN & CO

Base: Australia, with international projects

Project locations named by the practice: Point Piper, Vaucluse, Circular Quay, Toorak, Palm Beach, the NSW South Coast, Mayfair, Bel Air and the Caribbean

Sectors: Private residences, hotels, residential developments, private aviation and superyachts

Services: Interior design and architecture, property development, project management, property acquisition, documentation, furniture and lighting design, FF&E procurement, interior dressing and art curation

Design philosophy: Collected, personal interiors shaped by art, craftsmanship, travel and enduring materials

Website: free-man.co

Why Commercial Property Isn’t Following the Residential Market

While many investors are waiting for commercial property prices to fall alongside the residential market, buyers’ advocate Abdullah Nouh says they’re looking at the wrong data, with demand strengthening across several commercial sectors.

Jack Freeman believes the most compelling interiors are not decorated, but collected. The FREEMAN & CO founder creates layered, personal spaces shaped by art, travel and craftsmanship.