In 30 Seconds
The commercial property supply pipeline is the new space that may come to market: projects approved, under construction and nearing completion. The Commercial Dex measures the first stage, the value of building work approved in each council. In the 12 months to July 2026, industrial projects made up 47% of the value of commercial work approved across Australia. This guide explains what approvals measure, why approval is not completion, and how new supply affects vacancy and rents.
The commercial property supply pipeline is the new space that may come to market: projects approved, then under construction, then completed and leased. The Commercial Dex measures the first stage, the value of commercial building work approved in each council over the past year. It is an early signal of possible future competition for existing buildings, not a schedule of what will be built.
This guide explains the commercial property supply pipeline, what an approval does and does not tell you, and how new supply feeds into vacancy and rents. Unless another source is named, market figures are from HtAG Analytics as at 30 September 2026.
Data as at 30 September 2026. Reviewed 7 October 2026.
An approval is permission to build, not a promise to build. (HtAG Analytics)
Our guide to commercial property stock on market covers the space on offer today. This guide covers approved work as an indicator of space that may compete with it in future.
The commercial property supply pipeline: from approval to competing space
HtAG Analytics, concept diagram: illustrative stages; a project can stall or be cancelled at any of them.
The Australian Bureau of Statistics defines the starting point: “A building approval is the official permit that allows construction to begin” (ABS, Building Approvals methodology, 2026). After approval, a project still has to secure finance and, often, tenants. Construction then takes from months for a small warehouse to several years for an office tower, before the space is completed and leased up.
Not every approval proceeds. Describing Australia’s industrial pipeline in April 2026, Cushman & Wakefield noted that “close to three‑quarters of this speculative pipeline has not yet commenced construction, leaving a significant portion of future supply vulnerable to further delays or cancellations” (Cushman & Wakefield, April 2026).
How the Commercial Dex measures approved work
| Dex figure | What it measures | Unit | Window |
|---|---|---|---|
| Approved work | The value of building work approved by the council for this property type | Dollars | Latest 12 months of ABS approvals |
Source: HtAG Analytics Commercial Dex.
How HtAG measures this. Approved work comes from the ABS Building Approvals series, grouped by property type and summed over the latest 12 months available (to July 2026 in this release). In this guide we show approvals as shares and indexes rather than dollar totals.
Three points about the ABS data shape how to read it:
- Value is not floor space. The value is the estimated cost of the work when complete, excluding land. It rises with project size, but also with building costs and the type of building, so more value does not always mean more space.
- Approved value can differ from the final value. The ABS notes that non-residential approval values “can differ significantly from the completed value of the building as final costs and contracts have often not been established before council approval.”
- It includes alterations. Approvals cover new buildings and alterations and additions, by private and public owners. A large refurbishment adds value but may add little new space.
Approved work by property type
HtAG Analytics: share of the value of commercial building work approved across Australia in the 12 months to July 2026, by property type.
Industrial projects made up 47% of the value of commercial work approved in the 12 months to July 2026, office 27% and retail 26%. Office approvals are concentrated: Melbourne City alone accounted for about 17% of the office value approved nationally, and the City of Sydney about 13%.
HtAG Analytics, from ABS Building Approvals, Australia: value of approved work by ABS building type, calendar years 2019 to 2025, indexed to 2019 = 100. Nominal dollars.
By the ABS’s own building types, approved warehouse and factory work rose 57% between 2019 and 2025, after peaking in 2024 at 85% above 2019. Office approvals in 2025 were close to their 2019 value. Because these are nominal dollars, part of each rise reflects higher building costs rather than more space.
Explore commercial markets on the free heatmap. The HtAG commercial property heatmap shows what is advertised and what has sold and leased in every council, free. For named projects and non-residential approvals by council, HtAG’s free infrastructure projects map is another starting point.
How new supply affects vacancy and rents
Economists model property as two linked markets: a market for space, where rents are set, and a market for assets, where prices are set. New construction adds to the stock of space, which feeds back into rents and then prices (DiPasquale and Wheaton, 1992). Three findings help read a pipeline:
- Vacancy above its normal level pulls rents down. In US office markets, real rents fell about 2% a year for every point of vacancy above its equilibrium level (Wheaton and Torto, 1988).
- Long development lags breed cycles. Markets are more likely to boom and then oversupply when “supply is more elastic than demand, development lags are long, and asset durability is low” (Wheaton, 1999).
- Australian experience matches. The Reserve Bank of Australia notes that in commercial property “supply imbalances can build due to long construction times” (RBA Bulletin, September 2023).
So approvals do not automatically push rents down. The effect depends on how much of the pipeline is built, how much is pre-leased, how much old space is withdrawn, and whether demand grows to absorb it. Read approved work with commercial property demand indicators and months of lease stock.
Worked example: Kingston
HtAG Analytics Commercial Dex, Kingston, industrial, office and retail, 12 months to July 2026: squares represent approved-work value (dollar labels hidden here); Kingston industrial contributed 2.3% of national industrial approved work.
In Kingston, industrial work dominated the past year’s approvals, about 2.3% of all industrial work approved in Australia. Kingston industrial also had 8.3 months of lease stock as at 30 September 2026 and an industrial business mix of 1.22. Before assuming new supply will compete with an existing building, a buyer should ask how much of that approved work is pre-leased or owner-built, and when it is due.
Compare approved commercial building work by council
The Commercial Dex shows approved work for every council and property type, beside demand and leasing figures. It measures approved work, not a verified schedule of future completions.
Compare approved commercial building work by council · See plans
Approved work is included in the Commercial Dex with HtAG’s Professional plan.
Common mistakes
- Reading approvals as completions. Many projects are delayed, changed or never built.
- Reading value as floor space. Building costs and building type change the value.
- Ignoring alterations. Refurbishments add value but little new space.
- Assuming new supply always lowers rents. Pre-leasing, withdrawals and demand growth change the outcome.
Related reading
HtAG’s article on non-residential building approvals looks at approvals as a marker of infrastructure growth; this guide uses the ABS definitions to read them as a commercial supply signal. For the residential equivalent, see building approvals and future housing supply and supply-constrained markets.
Related commercial metrics
- Commercial property stock on market: the space on offer today.
- Months of stock: how quickly existing space clears.
- Commercial leasing activity: how much space is being taken up.
- Commercial property demand indicators: the demand side of the same market.
Research behind this guide
- DiPasquale, D. and Wheaton, W. C. (1992). The markets for real estate assets and space: a conceptual framework. Real Estate Economics, 20(2), 181-198. doi:10.1111/1540-6229.00579
- Wheaton, W. C. and Torto, R. G. (1988). Vacancy rates and the future of office rents. Real Estate Economics, 16(4), 430-436. doi:10.1111/1540-6229.00466
- Wheaton, W. C. (1999). Real estate “cycles”: some fundamentals. Real Estate Economics, 27(2), 209-230. doi:10.1111/1540-6229.00772
- Australian Bureau of Statistics (2026). Building Approvals, Australia methodology, August 2026. abs.gov.au
- Lim, J., McCormick, M., Roche, S. and Smith, E. (2023). Financial stability risks from commercial real estate. RBA Bulletin, September 2023. rba.gov.au
Key takeaways
- The supply pipeline runs from approval to construction, completion and leasing up; the Dex measures approved work.
- Approval is not completion, and value is not floor space.
- Industrial made up 47% of the value of commercial work approved in the 12 months to July 2026.
- New supply lowers rents only if it outpaces demand, after pre-leasing and withdrawals.
- Read approved work with demand and leasing before judging a market.
FAQs
It depends on the project. After approval, a developer may need finance and pre-leasing before starting; construction can take months for a small industrial building and several years for an office tower; then the space must be leased up.
Some approved projects are delayed or never built, so treat approvals as possible future supply.
Not automatically. Completed space can put downward pressure on rents when it adds unoccupied supply faster than demand absorbs it, after allowing for withdrawals. Vacancy can also rise when occupier demand contracts.
A pipeline that is largely pre-leased, or that replaces old stock, may add little competition.
The ABS building approvals series the Dex uses reports the estimated value of the approved work. Value rises with building costs and varies by building type, so it signals activity rather than measuring space.
That is why the Dex shows approved work as a signal and why this guide compares it as shares and indexes.
See the Data Behind Commercial Supply
The figures in this guide come from HtAG Analytics’ Commercial Dex, which compares commercial property by council and property type. Start with the free commercial property heatmap, look up any measure in the Data Dictionary, or see plans for full access.
Disclaimer: This article is general information for educational purposes only and does not constitute financial, legal or lending advice. Market figures describe council areas, not individual properties, and are derived from historical data and statistical modelling; they are not guarantees of future performance. Always conduct your own due diligence and consult qualified advisers before making investment decisions.
