As 2025 draws to a close, one signal is becoming increasingly clear across national markets:
Commercial investors are already positioning for 2026.
In recent weeks, a wave of high-quality, non-discretionary assets has been rapidly absorbed by the market—particularly in fast food, childcare, healthcare, and convenience retail, all of which are prized for their stable cash-flow profiles.
These transactions are quietly reshaping the investment landscape for 2026.
01 | Market Momentum Confirmed by Transactions: Clear Yield Compression
Below are key data points from the most recent public-market transactions (sourced from this week’s auctions):
Fast Food Assets Take Centre Stage (Total: AUD 16.54m)
•McDonald’s (Cairns)
AUD 5.035m | 3.38% yield
•Hungry Jack’s (Sydney North-West)
AUD 7.455m | 4.49% yield
Notably, in October:
•McDonald’s (Hampton Park, Melbourne)
AUD 4.714m | record-low 2.78% yield
This represents one of the tightest yields ever recorded for a McDonald’s asset nationally and underscores investors’ unprecedented appetite for blue-chip tenant cash flows.
Childcare Assets Continue to Be Absorbed at Stable, Tightening Yields
•Goodstart Early Learning (Townsville)
AUD 3.455m | 4.41% yield
•Little Seedlings (Wyee, NSW)
AUD 2.71m | 5.54% yield
➡ Childcare yields are now consistently trading within the 4.4%–5.5% range, with a clear ongoing compression trend.
Retail Assets Show Increasing Polarisation
•Oliver’s (Gundagai, NSW)
9.44% yield
•Bega Retail Centre (NSW)
9.41% yield
➡ Yield dispersion is widening, driven by brand strength and locational quality.
02 | Why Late-2025 Transaction Data Matters
These sales are not isolated events. They reflect several deeper market dynamics:
Investors Are No Longer Waiting for Rate Cuts
Capital is being deployed now to lock in long-term, defensive cash flows, particularly in assets with:
•Blue-chip tenants
•Non-discretionary consumer demand
•Long lease terms
New Supply Is Falling Sharply
Rising land and construction costs have materially constrained new development across fast food, childcare, and essential retail.
➡ The later investors move, the fewer opportunities remain.
Private and Institutional Capital Are Returning in Tandem
According to MSCI:
“Large institutions have re-entered retail and essential asset markets, a pattern that typically signals the end of a cycle trough and the beginning of recovery.”
Cornerstone Assets’ View
At Cornerstone Assets, our assessment is clear:
Yields are likely to continue compressing in 2026, and high-quality assets will become increasingly scarce.
Based on our on-the-ground observations across multiple states—covering acquisitions, valuations, and buyer behaviour:
•2025 is a base-building year
•2026 will be a re-pricing year
For assets such as childcare, fast food, healthcare, and convenience retail, yields are likely to compress by a further 25–75 basis points through 2026.
For investors:
📌 Early positioning is critical to securing lower-cost, resilient cash flows and maximising long-term capital outcomes.
