Australian annual retail property investment volumes reach $16.3 billion as of Q3 2026, marking the strongest 12-month period on record
20 October 2026
Building on 2025's record calendar year for retail with $14.0 billion transacted, the retail property sector continues to cement its place as a major focal point for capital allocation in 2026.
Australian retail property investment has surged, with Q3 2026 transaction volumes reaching $4.6 billion, 98 per cent above the ten-year historical average, according to the latest data from JLL Research. This performance marks the second strongest quarter since 2022, continuing a sustained wave of momentum that has been building since 2025. Over the 12 months to Q3 2026, rolling annual retail property transaction volumes reached $16.3 billion, representing the highest rolling annual total recorded in JLL Research’s tracking history.
The strength of the retail property investment market appears at odds with a weaker economic environment, characterised by persistent inflation and higher interest rates. Consumers are still spending, albeit with greater discernment regarding how they are allocating their spending. Value, necessity, and experiential spending remain key drivers of consumer purchases, with annual household spending up 5.6 per cent in August 2026, according to the Australia Bureau of Statistics (ABS)1.
Investors are looking through the noise to the longer-term retail fundamentals that underpin reliable returns.
Sam Hatcher, Head of Retail Investments - Australia and New Zealand at JLL, said, “The positive ‘bottom up’ fundamentals within the Australian retail market continue to attract existing and new institutional capital to the highly resilient sector. It is the most transparent real estate investment sector in Australia and most transparent retail market globally. No other sector gets monthly sales figures of their investments. It’s unique and a premium is applied for that.”
Queensland has emerged as the standout market with both significant investment and development. The state recorded $6.2 billion of transactions in the 12 months to Q3 2026, making it the largest market ahead of New South Wales ($4.8 billion) and Victoria ($3.2 billion). Supported by recent transaction evidence, Queensland’s median regional yield tightened 12.5 basis points to 5.63 per cent, the tightest nationally. Strong population growth, regulatory stability, and the 2032 Olympic games are all tailwinds supporting investor confidence.
Nationally the strong retail property performance through 2025 and 2026 has been anchored by a rise in regional shopping centre transactions, which are among the most expensive centres traded. The number of regional centre transactions has grown steadily from six in 2023, to nine in 2025. With five regional transactions already completed so far in 2026, cumulative transaction volumes have reached $5.0 billion. Given the sparse pipeline of new regional centre developments, owners have favoured selling partial or half stakes to retain exposure to these prime assets.
For retailers, regional centres serve as an ideal platform for omnichannel integration, creating engaging, experiential environments that bridge the digital and physical formats. Strong demand from international and national brands seeking premium retail space has driven ongoing centre upgrades and expansions and has kept vacancy rates low at 2.0 per cent as at H1 2026.
Neighbourhood centres were the second-largest sub-sector traded, recording $2.5 billion year to date (22.5 per cent of volume). Large format retail followed with $1.1 billion, then sub-regional centres with $0.8 billion, and prime CBD retail with $0.4 billion.
Neighbourhood centres remain the most actively developed sub-sector since 2024, adding 24 new assets over 2026 to date.2 These developments have been concentrated across fringe growth corridors and high-growth residential areas. This trend is set to continue into 2027 and 2028, with 61,338 sqm of new retail space expected to be delivered over this period.
Australia's strong population growth, which is on track to reach 30 million by 2033, is a primary fundamental driving the development and success of supermarket-anchored retail. At the same time, the ageing demographic has become a critical consideration for landlords when optimising tenant mixes and shifting towards essential services like healthcare. Ultimately, neighbourhood centres have proven to provide highly defensive income streams even during periods of softer consumer spending.
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