Australian Commercial Property Sales Rise in First Quarter

Posted on 9 April, 2013 by Jodee Redmond

Approximately $3.5 billion in commercial property priced at $5 million and above was sold in the first quarter of the year in Australia, according to figures released by CBRE. A-REITs are returning to the market, in a sign that the market is off to a healthy start in 2013.

Perth central business district across Swan River

This figure represents a 15 per cent increase compared to the number of transactions that closed in the same period last year, according to Stephen McNabb, CBRE’s head of research for Australia.

Domestic investors made their presence felt in the quarter, with the level of properties being bought by locals increasing by one-third over the same time last year. Foreign investor activity was down by 31 per cent during the three-month period.

CBRE’s national director of capital markets, Josh Cullen, stated that the recent of level activity in domestic REITs seeking core investments across all property sectors was a good sign for this year.

He said, “In the past week alone we have received in excess of $4.5 billion worth of offers with the closure of sales campaigns for Raine Square in Perth and the GE Core portfolio.

“The local REIT’s are well positioned with both balance sheet and wholesale capacity to take advantage of quality offerings in the market place.

“Leveraging has reduced to around 26 per cent from a peak of circa 40 per cent, which would imply funding capacity of $6 billion if leverage moved back to a still conservative level of around 32 per cent.”

Cullen pointed out that one issue was the lack of quality stock available on the market. The inventory shortage was expected to result in “cap rate compression for core assets.”

Approximately $14.3 billion in commercial sales have been recorded for the 12 month period up to March 27. This is a one per cent increase over the $14.2 billion in sales recorded in the 12 months ending in March of 2012.

Leave a Reply

Your email address will not be published. Required fields are marked *

This site uses Akismet to reduce spam. Learn how your comment data is processed.

Recent Posts

Optimism from the Bank of England’s chief economist

The most expensive commercial properties.

Businesses operating from shared premises will miss out on grants

BA cuts 12,000 jobs, unions hit back

Media Streaming Service See Record Subscriptions

Covid-19 Causes Millions To Claim UK Furlough Scheme

America, Amazon Wants You!

UK Firms Battle To Survive

COVID-19 Grounds EasyJet Fleet

ECB Emergency Fight Back Aganist Covid-19

Aldi’s Expansion Plan

British Steel on the verge of collapse with over 20,000 jobs at risk

Paris watches as flames engulf one of France’s most famous landmarks

Debenhams on the brink of administration as board reject Ashley’s bid

Emmanuel Macron pushes for a new Europe with European Parliament elections on the horizon

Brexit impacts property market

Brexit uncertainty impacts the property market