What It Is:

Using your SMSF to borrow and purchase commercial property. This category includes offices, warehouses, retail spaces, medical suites, and more.

Key Features:

• You can lease the property back to your own business, if done on commercial terms.
• Commercial property can often provide higher yields than residential property.
• Must be purchased through a Limited Recourse Borrowing Arrangement (LRBA).
• Held in a Bare Trust, with the SMSF as the beneficiary where there’s lending requirement
• Lease agreements must be properly documented and reflect market conditions.

Ideal For:

• Business owners who want to own their premises through their super fund.
• SMSFs targeting higher-yielding, long-term property investments.

Considerations:

• More flexible than residential in terms of related-party use.
• Commercial property values and demand can be more volatile.