Opportunity is the great conundrum for commercial property investors

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While Australia’s property market remains a safe haven, limited stock is a significant obstacle for overseas investors, Napier & Blakeley’s managing director Alastair Walker.

“There is still a substantial amount of investment funds under management looking for a home – and the volatility in other markets serves as a reminder that Australia remains a safe haven,” says Walker, who oversees the independent property, development and sustainability consultancy.

The latest investment intentions survey from the Asian Association for Investors in Non-listed Real Estate Vehicles (ANREV) reports around AU$82.4 billion is expected to be poured into property in 2016, with the top three investment destinations in the regions of Tokyo, Sydney and Melbourne.

“Opportunity is now the great conundrum facing investors,” Walker recently blogged.

“Australia presents a transparent market with a good yield to debt ratio, but a shortage of stock is limiting investment opportunity.

“The local property investment groups who have righted their ships in the last seven years after the Global Financial Crisis are now heavily challenged by offshore investors, some with very deep pockets.”

“Our chairman, Peter Mitchell, is based in Singapore, and travels around Asia talking to investors and we get reports back every day, especially from Chinese investors wanting to get into the Australian market. These aren’t just big global funds, but a range of investors who see Australia, and particularly Sydney, as an attractive destination,” he adds.

While Sydney and Melbourne remain the “first choice” for offshore investors, Walker says they are increasingly looking further afield – and are looking beyond traditional shiny new offices.

“Expect retrofitting of existing assets – something that has been slow off the mark – to become a bigger thing in 2016,” Walker says.

Established in 1985, Napier & Blakeley is an independent and privately-owned, international, integrated, property services consulting organisation. 

Contact one of our specialists for further information.