CBD hotel confidence leads office, retail: NAB

CBD hotel confidence leads office, retail: NAB
CBD hotel confidence leads office, retail: NAB

Confidence in the CBD hotels sector outweighs office and retail for the year ahead by sector, according the NAB Quarterly Australian Commercial Property Survey Q1 2016, which noted the Commercial Property Index fell to +12 points but is above the long term average.

According to the report all markets are tracking above long-term average levels, except CBD Hotels, which it continues to out-perform the broader market. 

NAB chief economist Alan Oster said Property professionals in the CBD hotels sector are also the most confident in the next year, followed by office and retail.

"However, confidence levels are broadly similar across all market sector participants in 2 years’ time," he said.

"By state, sentiment improved in NSW and it continues to lead the country by some margin, led by a strong contribution from the Office sector. Sentiment also improved a little in WA, but remains deeply negative and by far the worst performing state, dragged down by chronically under-performing Office and Industrial property markets. Sentiment was lower in all other states. 

“Property professionals in NSW are the most optimistic in the next 2 years, but those in Victoria are expecting the biggest improvement. WA remains the most pessimistic state, but only just ahead of SA/NT." 

On average, capital values are expected to increase most for CBD hotels in the next 1-2 years (1.4 percent & 3.4 percent). 

"Office rents are expected to grow 1.1 percent and 1.5 percent in the next 1-2 years, led by  NSW and to a lesser extent Victoria. Significantly, for developers intending to start new projects, a survey low 38 percent indicated they were targeting residential developments, down from 54percent in Q4, presumably reflecting the over build in apartment markets,” he said. 

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CBD hotel confidence leads office, retail: NAB

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