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Australian capital cities in overseas investment spotlight

On Sep 18 2013
Tagged as:
  • Commercial Property

Owners of commercial property will be happy to hear that the number of overseas investors turning ...

Owners of commercial property will be happy to hear that the number of overseas investors turning on to Australian property is set to grow over the coming months, with a forecast of $18.5 billion from more than 50 offshore firms set to be invested in the nation.

The recent news of Singaporean investors buying up large in Melbourne and Sydney was only the tip of the iceberg, with Cushman & Wakefield (C&M) Director Tony Dixon stating that there are a number of other firms from across Asia, as well as from Europe and America, interested in purchasing commercial real estate in Australia.

"We are receiving new enquiries from high profile investors on a weekly basis and in many instances these firms are demonstrating a willingness to pay a premium, especially those who are taking a trophy hunter approach with their acquisition strategy," said Mr Dixon in a September 12 statement.

The main property attraction for these firms is prime commercial property investment options in the hearts of Australia's capital cities central business districts, with long term leases and the opportunity to set up a sustainable business.

However, with the market being as competitive and tight as it is, many firms are also warming to the idea of smaller assets in separate areas of the cities. This is a fantastic turn of events for owners of commercial property across the nation, with the opportunity to earn sizeable gains from the sale of their real estate.

C&M Associate Director Peter Ainge said that the amount of activity in Australia has been minimal, and that the major investors have merely "dipped their toes in the water".

"In total there has been some $610 billion worth of property purchased globally by investors outside of their country of origin in the three years to July 2013. However of this $610 billion, Australian investment accounted for less than 3 per cent," said Mr Ainge in a September 12 statement.

Over the past three years, half of the world's largest property purchasers have bought investments within Australia, highlighting the increasing activity within the market. 

"Our research has identified over 50 offshore firms that have a definite mandate for Australian investment. Then there are the many other firms who may not have a direct mandate, but would be willing to invest in Australia if the right opportunity presents itself," said Mr Ainge.