Townsville, the largest city in northern Queensland, is facing significant commercial rate increases that have raised alarms among local investors. The Townsville City Council has announced a staggering increase in minimum rates for commercial properties, which have risen by 50 percent. The minimum rates for heavy industry properties have also seen a similar increase, leading many to question the city’s competitiveness in attracting business.
The council’s 2025-26 budget, presented in June, outlined a 54 percent increase for commercial properties, while heavy industry rates will increase by 50 percent. This decision comes amid ongoing financial struggles, prompting the council to cut community grants and services. The council’s financial difficulties have led to heightened scrutiny, particularly regarding its handling of property valuations and rate calculations.
Local commercial property manager Craig Stack, who has over 20 years of experience in Townsville, expressed dismay at the rate hikes. He noted that these increases follow a period of rising operational costs, including insurance and electricity. A comparative analysis of the council’s budget documents reveals that a commercial ratepayer who was charged a minimum of $1,506 last year will now face a bill of $2,329. Approximately 800 commercial properties will be subjected to the highest rate increases.
Additionally, the minimum rate for heavy industry properties has surged from $2,259 to $3,383, impacting just 30 heavy industry properties in the area. Stakeholders are concerned that these changes could drive businesses away from Townsville, with Michael Kopittke, an investor and former board member of the Townsville Chamber of Commerce, highlighting the potential for landlords to pass on increased costs to tenants, diminishing their returns.
The council representative confirmed that the methodology for calculating rates has not changed, attributing the significant increases to recent property valuations conducted by the Queensland valuer-general. From 2022 to October 2024, the total value of commercial properties in Townsville rose by 22.9 percent, while industrial properties saw an even steeper increase of 42.4 percent.
Investor sentiments are shifting, with many expressing fears that Townsville could lose its competitive edge to nearby cities like Cairns and Mackay. Stack noted, “Townsville was already viewed as a city with quite high general rate levies.” He pointed out that Mackay, which manages a shopping centre for the same landlord, has a higher land value but lower rate charges.
Calls for transparency have emerged from both Stack and Kopittke, who urge the Townsville City Council to communicate the implications of these rate increases more effectively. They also indicated that some landlords will be liable for land tax for the first time due to the increased property values.
During the June budget speech, Acting Mayor Ann-Maree Greaney did not address the commercial rate increases. A spokesperson for the council stated that with over 85,000 properties across 57 categories in the Townsville region, it is challenging to acknowledge individual changes for every ratepayer. They added that the council had publicly acknowledged the potential increases resulting from updated land valuations.
In anticipation of the budget, the council attempted to mitigate the impact of rising land values by reducing the rate-in-the-dollar charge, a dual approach used to determine rates. As Townsville navigates these financial challenges, the implications for the local economy and its business landscape remain to be seen.
