The next move for capital that’s done sitting still

Why now could be the time to lean into property - but not in the way you think.

When interest rates surged and markets wobbled, holding cash felt smart. Term deposits were paying 5 to 6%. Sitting still was strategic.

But that window is closing. Rates are easing. And cash, while useful, is no long-term plan. With deposit rates now around 4% and inflation at 2.5%, real returns are slim. After tax, they’re barely there.

Historically, this is when capital starts to shift - away from cash, toward assets that offer both income, long-term growth and act as a hedge against inflation. Not for quick wins, but to redeploy it into opportunities designed to perform over time.

Unlisted commercial property funds offer a viable alternative. They provide access to large-scale, institutional-grade assets - without the mortgage, the deposit or the complexities of direct ownership. And with comparatively low entry points, they’re more accessible than many investors assume.

A two-engine return: income + growth

Commercial property generates returns in two ways: rental income and long-term capital growth. What sets it apart from residential investments is structure. Leases are typically long-term, often with built-in rent increases, which help create consistent, contracted cash flow.

You’re not just relying on the market to lift the value. You can earn and grow income along the way, with the potential for capital growth over time.

Not always smooth sailing - but steady across cycles

Commercial property has felt the pressure. Over the past two years, higher interest rates pushed up borrowing costs. Insurance and operating expenses rose. Like most asset classes, valuations dipped and there was pressure on non-distributable income.

And yes, the ‘For Lease’ signs are still out there. But that’s not the whole story. You’re not betting on the next 12 months. You’re investing in what comes after.

This is a long-term asset class - and that’s where its strength lies. Property moves in cycles. It doesn’t need perfect timing to perform. Long leases and gradual valuation growth typically back these investments.

Time smooths out volatility, supports compounding returns and reduces the noise of short-term sentiment. And right now? Recovery is still early, but momentum is building.

Valuations have stabilised. Demand for quality property is picking up. And in many funds, income distributions are building again.

You don’t need a mortgage to invest in property

There’s still a perception that property investment means a big deposit, a mortgage and taking on the role of landlord. But that’s not the only way in.

Unlisted commercial property funds let you invest alongside others in large-scale, income-generating assets – with less barriers to entry and without the debt or the day-to-day responsibility. You’re not just buying into property. You’re buying into a strategy, managed by seasoned experts, with built-in diversification, structure and scale.

Inflation is not always the enemy

Inflation is top of mind for switched-on investors - and for good reason. But in commercial property, it’s not always a threat. In some cases, it helps.

Many leases include fixed annual increases or CPI-linked reviews, so rental income doesn’t just hold its value - it often rises with inflation. It’s one of the few asset classes where inflation protection is built in, not bolted on.

Listed ≠ direct

Not all commercial property investments behave the same. Listed property trusts (REITs) trade like shares and often move with market sentiment. Their value can swing on headlines, investor flows or broader market shifts.

Unlisted funds work differently. Their value is tied to what’s happening on the ground - rent collected, leases renewed, tenants retained - not to daily market movements. A fully leased property doesn’t stop earning just because the market has a bad week. For investors seeking steadier, asset-backed returns, that difference matters.

Tax advantages worth knowing

Unlisted commercial property funds often sit within PIE (Portfolio Investment Entity) structures - and that can come with meaningful tax benefits, especially for long-term investors:

The result? A tax position that stacks up well against many other income-focused investments - particularly over time.

Built to hold, not to chase

Like any investment, unlisted commercial property funds are not without risk -  and they’re not for everyone. Liquidity is more limited than listed assets, though secondary markets can offer flexibility if investor needs change. They’re also not designed for quick wins, because value is built gradually over time.

But for investors building a diversified portfolio and seeking long-term exposure with built-in resilience, they offer something rare - real assets, real income and a strategy built to keep earning through the cycle.

This isn’t about timing the market. It’s about owning a piece of it.