business
Geelong Commercial Sector Confronts Rising Rents and Supply Chain Pressures
Strong occupancy and investor interest mask headwinds from escalating costs and global uncertainties for local businesses.
How we reported this
Central Geelong business spending reached $944 million last year as the region recorded 3.5% growth in registered businesses and nearly 800 new operations in 2024. This momentum continues even as operators face clear headwinds from rising rents and global supply chain uncertainties that are reshaping decisions around leasing, ownership and manufacturing.
Rising Rents Drive Shift Toward Ownership
Interstate investors from Melbourne and Sydney are increasingly targeting Geelong's commercial property market. Businesses are moving from leasing to owning properties because of rising rents and the city's strong growth fundamentals. The pressure on rental costs is prompting a structural change in how local operators secure space, particularly in the CBD where demand remains elevated.
Manufacturing Revival Tied to Supply Chain Uncertainties
An estimated 34,000 new jobs are projected to be created in Geelong over the next five years as manufacturing makes a comeback driven by global supply chain uncertainties. Australian Textile Investments has purchased Geelong Textile Group, a historic wool manufacturer established in 1920, to secure wool manufacturing within Australia. These moves reflect efforts to stabilise operations amid external disruptions that continue to affect input costs and delivery timelines.
Office Market Shows Resilience at Key CBD Site
60 Moorabool Street in Geelong's CBD has reached 100% occupancy with recent leasing agreements from major tenants including WorkSafe, GMHBA, and IAG. The full occupancy signals a booming office sector even while broader cost pressures test smaller operators across the region.
The combination of sustained spending growth, new business registrations and incoming investment indicates the local economy retains underlying strength. Operators are adapting by securing ownership positions and vertically integrating supply where possible to manage the documented headwinds of higher rents and uncertain global chains. Future outcomes will depend on how effectively these strategies offset the ongoing cost and stability challenges.