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Property News

Commercial centres attract investor attention

January 17, 2012

While the increased pedestrian traffic offered by malls and shopping centres is a powerful attractant for many business owners, an increase in investor activity could produce a shift in the market.

According to property analyst firm Urbis, syndicated buyers and retail-specific trusts have been showing a greater level of interest in regional and sub-regional commercial real estate.

The company's director Ivan Hill told Property Australia on January 9 that investors were interested in assets with "development or repositioning potential".

Hill asserted: "...there are early signs that the larger, more mature sub-regionals are coming back on to the radar of institutional investors."

The increased interest could mean that they are expecting an increase in yields, which is derived through revenue rates - meaning that rental prices could potentially go up in the future.

Savvy business managers could use this signal as an opportunity to investigate the leasing options of a commercial property outside of a retail centre before a rush for lower-cost properties begins.

With some research on the right location, high volumes of foot traffic can still provide increased levels of public exposure with the added bonus of a more reasonable rental rate.

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