Private investors return to retail property market as trusts sell out: Chart of the week

Private investors were the most active buyers of retail property in 2012, acquiring more than a third (36%) of the $3.7 billion of retail property that changed hands in Australia over the calendar year.

Institutions represented by funds, trusts and syndicates accounted for a combined 32% of purchasing activity while foreign investors were also active acquiring 24% of retail property.

“Private investors had been sidelined from purchasing retail property for a number of years due to strong demand from institutional investors. Also of particular note is the emergence of foreign investors purchasing 23% of retail property sold,” says Savills national head of research Tony Crabb.

“Evidently, the global credit crisis created a window of opportunity for private and foreign investors to re-enter the market.

“As conditions for Australian institutions continue to improve, private and foreign investors may well find themselves unable to compete again.

“Purchasers have become more confident the commercial property market has passed the bottom of the cycle,” he says.

Property trusts (26%), syndicates (21%) and private investors (21%) were the biggest sellers of property over 2012 with private trusts and syndicates also active.

Of note, 12% of retail property sales last year were mortgagee in possession sales.