Institutional investors spend $3 billion in neighbourhood markets: Savills

Institutional investors spend $3 billion in neighbourhood markets: Savills
Institutional investors spend $3 billion in neighbourhood markets: Savills

Institutional investors have injected more than $3 billion into the sub-regional and neighbourhood markets in the 12 months to June with neighbourhood centre sales up 180% on the five year average.

According to the Australian Neighbourhood and Sub-Regional Shopping Centre Spotlight from Savills Australia neighbourhood shopping centre transactions totalled $2.5 billion in the year to June, up on the five year average of $895 million.

Tony Crabb, Savills’ national head of research, said institutions accounted for 65%of the $2.5 billion national spend on neighbourhood shopping centres and 67% of the $2.l billion outlayed on sub-regional assets over the period.

"At $2.1 billion sub-regional sales were also up, albeit a mere 17 per cent on the $1.8 billion of recorded sales in the previous year, but almost double the five-year average of $1.1 billion," Mr Crabb said.

"Of those sales, funds, trusts and syndicates have accounted for $1.625 billion in neighbourhood shopping centre transactions and $1.407 billion in sub-regional sales."

Steven Lerche, Savills’ national director of retail investments said the demand had seen yields for prime assets tighten to a post-GFC low, at 6.25 to 6.5%, which would continue to come under pressure as cashed up institutions and low interest rates continued to drive the market.

"Foreign investment, which had been a key driver of record property investment markets in recent times, has not been a significant player in recent neighbourhood and sub-regional sales although foreign money is increasingly looking to partner with Australian connections," Mr Lerche said.

 

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Institutional investors spend  billion in neighbourhood markets: Savills

Click to enlarge

Institutional investors spend  billion in neighbourhood markets: Savills

Click to enlarge

Institutional investors spend  billion in neighbourhood markets: Savills

Michael Crawford

Michael Crawford

Michael is the real estate reporter for western Sydney and loves writing about homes and the people who live in them. A former production editor and news journalist, he enjoys writing about real-world property purchases as well as aspirational buys and builds. Following a recent move from Sydney’s northern beaches, Michael now actually enjoys commuting.

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