SMSF shake-up puts commercial property in the frame

The legislated ban on new SMSF residential borrowing has closed a familiar pathway for brokers but opened a less-travelled one. SMSF commercial property lending is gaining traction as self-employed clients and investors look to hold business premises within their super funds. ATO data shows SMSFs held $116.7 billion in non-residential property as at December 2025, nearly double the $60.9 billion held in residential. Richard Chesworth of Bluestone Home Loans argues that most brokers already have the client relationships needed to make this shift.

What does the legislated ban on SMSF residential borrowing mean for mortgage brokers?

The legislated ban on new SMSF residential borrowing has closed a familiar pathway for brokers with established SMSF client books. Richard Chesworth, head of specialised distribution at Bluestone Home Loans, sees the change as a prompt rather than a setback. 'As residential options narrow in this space, commercial is becoming a more important pathway for SMSF clients who still want geared exposure to direct property through their fund', he says. 'It puts brokers in a strong position to guide what's possible from a borrowing perspective and help clients keep moving forward.' For brokers newer to SMSF commercial lending, Chesworth frames the ban as a genuine opening into a part of the market where client demand is already shifting in that direction.

How much commercial property do Australian SMSFs currently hold, and what does ATO data show?

The scale of SMSF commercial property holdings is often underestimated. As at December 2025, SMSFs held $116.7 billion in non-residential property compared with $60.9 billion in residential, according to the ATO Self-Managed Super Fund Statistical Report. A further $77.8 billion sits in limited recourse borrowing arrangements spanning various property types. Chesworth points to a longer historical pattern: 'In 2009, residential property was [worth] one-third of the non-residential assets in SMSFs, and presently it's over half the value of non-residential property, excluding geared properties.' Commercial has long dominated the SMSF property story. The residential ban does not create this imbalance; it simply reinforces a gap that was already substantial and growing.

Why are self-employed business owners the strongest starting point for SMSF commercial property lending?

Self-employed clients represent one of the clearest entry points for brokers moving into SMSF commercial property lending. Rather than paying rent to a third party, a business owner can use an SMSF to acquire their own premises and redirect that rent into their retirement fund instead. The business real property rules within an SMSF are designed precisely for this scenario. Chesworth says the appeal is practical and persistent: 'Self-employed customers will no doubt continue to explore using an SMSF to acquire their business premises.' Brokers who already work regularly with self-employed clients are well placed to raise this option as a natural extension of an existing conversation, not as an unfamiliar pitch requiring a completely different kind of expertise.

What is actually stopping brokers from entering SMSF commercial property lending?

The most common barrier for brokers entering SMSF commercial lending is not a knowledge gap. 'A common hurdle is simply confidence, not capability', says Chesworth. Commercial deals can look more involved from the outside, with documentation and deal structuring that feel like a step up from familiar residential work. That impression tends not to survive first-hand experience. 'Once brokers get a couple of deals under their belt, confidence builds quickly', Chesworth says. 'Commercial becomes less of a stretch and more of a natural extension of their business.' For most brokers, the first deal is genuinely the hardest part. By the third, the process tends to feel considerably more routine than the initial hesitation suggested it would.

How is Bluestone Home Loans making SMSF commercial property lending more practical for brokers?

Bluestone Home Loans has built its commercial property lending directly into ApplyOnline, the platform many brokers already use for residential deals. The serviceability approach is designed to feel familiar rather than foreign. 'It means less friction, and more confidence to have the conversation earlier', says Chesworth. Broker uptake has been building steadily since launch. Chesworth describes how broker behaviour has shifted: 'What's changed over the past year is how brokers are using it. It's moved from being something they explore occasionally to something they're actively [discussing as part of] client conversations, particularly with investors, business owners and SMSF clients seeking direction.' Removing the platform barrier means one fewer practical hesitation standing between a broker and their first SMSF commercial deal.

What compliance boundaries must brokers observe when discussing SMSF commercial lending with clients?

Brokers operating in the SMSF commercial space need a clear sense of where their role ends. Decisions about establishing or investing through an SMSF involve superannuation strategy that falls outside a broker's licence. Those conversations must involve appropriately licensed financial advisers or accountants. Chesworth is direct on this point: 'Building strong relationships across a client's broader adviser network helps ensure everyone is working towards the right outcome.' For brokers willing to invest in those professional relationships, collaboration also creates a practical channel for referrals. Knowing the boundary is not a constraint; it makes a broker more useful to a client than one who overreaches. The SMSF space rewards brokers who understand exactly what they can and cannot do.

How does working with SMSF commercial property clients change the nature of broker conversations?

SMSF commercial property clients think about cash flow, asset positioning and long-term structure rather than just the next loan. 'These clients tend to take a more strategic view, but their financials are often more complex', says Chesworth. 'You're typically working with self-employed borrowers, business owners or investors who are managing multiple income streams.' That complexity creates depth in the client relationship over time. Chesworth describes the shift in scope: 'The conversation moves beyond a single loan and into how lending supports a broader strategy, whether that's through a business purchase, an investment asset or a commercial property held within super.' Brokers who can hold that kind of conversation tend to become something more than a transactional service provider for their clients.

Featured expert

Richard Chesworth: head of specialised distribution, Bluestone Home Loans; non-bank lender operating in Australia for over 25 years; specialises in self-employed borrowers, complex-income clients and SMSF commercial lending.