Improved global outlook helps Australian commercial property

Improved global outlook helps Australian commercial property
Chris LangDecember 8, 2020

During the last quarter of 2011 there was a definite improvement in the US economy — with consumer spending up and companies finally replenishing their inventories.

GDP increased by an annualised 3%, with improved sales for durable goods and new homes.

Petrol prices have been cheaper since mid-2011, and the US jobless rate was the lowest in nearly 3 years.

Therefore, with improved employment figures, consumers have felt more comfortable spending — which represents around 70% of US economic activity.

And despite the European turmoil, the German economy has remained resilient — also growing by 3% over the past 12 months.

What does this mean for Australian commercial property?

In Australia, offices remain the preferred asset class for performance during 2012, followed by retirement property.

However, retail property was expected to be a negative performer after decades of strong rental price.

In contrast, the Property Council of Australia/ANZ survey found:

The office and industrial markets are particularly well placed, as reflected by the positive net balance of capital growth expectations for the sectors.

According to Jones Lang LaSalle, during last year $US400 billion in direct commercial property deals were made worldwide — which reflected an increase of 25% on 2010.

Bottom line: Australia's share of those deals was $6.5 billion in office towers during last year — with 28% of those purchases being made by overseas buyers.

And this trend is expected to continue strongly during 2012, and beyond.

Chris Lang is an advisor to commercial property investors and gives keynote speeches and regular seminars on the best way to invest in commercial property. He maintains a blog, his-best.biz, which he updates regularly about the best way to get the most out of your commercial property investment.

Chris Lang

Chris Lang is an advisor to commercial property investors, sell-out author and regular speaker on how to invest in commercial property.

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