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Did You Know You Can Still Buy Commercial Property With Your Super?
There’s been a lot of noise lately about changes to superannuation rules, and understandably, plenty of people are confused about what’s still allowed and what isn’t.
Here’s what you need to know: if you have a Self-Managed Super Fund (SMSF), you can still buy commercial property — and you can still borrow to do it.
So what actually changed?
In mid-2026, the Federal Government banned SMSFs from borrowing to buy residential investment properties. It made headlines, and it caused a lot of people to assume the doors had closed on SMSF property investment altogether.
They haven’t. The ban applies to residential property only. Commercial and industrial property — think warehouses, offices, retail spaces, and industrial units — was left completely untouched.
Why would you buy commercial property through your super?
Here’s where it gets interesting. One of the biggest advantages of holding commercial property inside an SMSF is that you can actually lease it back to your own business — legally and at market rent. So if you run a business and you’re currently paying rent to someone else, this could be worth exploring.
On top of that, the tax treatment is genuinely attractive:
Rental income is taxed at a maximum of 15% inside an SMSF — compared to your personal income tax rate, which could be significantly higher
If you hold the property for more than 12 months, capital gains are taxed at just 10%
Once you move into pension phase, both rental income and capital gains can be taxed at 0%
What are the rules?
As with anything super-related, there are rules you need to follow:
The property must be what the ATO calls Business Real Property — meaning it’s used wholly and exclusively in a business
It must pass the Sole Purpose Test — it has to be held for the purpose of providing retirement benefits to fund members
Everything must be done at market value — the purchase price and any rent charged must reflect what you’d get in an open market transaction, even if you’re leasing to your own business
Can you still borrow to buy?
Yes. SMSFs can still use a Limited Recourse Borrowing Arrangement (LRBA) to purchase commercial property. This means you don’t need to have the full purchase price sitting in your fund — you can borrow the shortfall, with the lender’s exposure limited to the property itself.
The bottom line
The 2026 rule changes were significant for residential property investors, but for anyone looking at commercial real estate, the opportunity remains very much open. If you own a business, run a SMSF, or are simply looking for ways to grow your retirement wealth through property, commercial real estate is worth a serious conversation.
This is general information only and does not constitute financial or legal advice. We recommend speaking with your financial adviser or accountant before making any investment decisions.
