A spike in foreign investment is behind a jump in commercial property sales in the second quarter of 2015, despite one state failing to record a single office sale of more than $5 million.
Sales of commercial properties worth more than $5 million totaled $5.9 billion Australia wide from April to June – a $2.5 billion increase on the first three months of the year but a $300 million drop on the same time last year, according to CBRE data.
Foreign money continued to pour into the commercial market, with a third of all sales coming from overseas investors.
CBRE senior research manager Bradley Speers says that while New South Wales attracted the most sales for the fourth consecutive quarter, it was South Australia and Queensland that made the biggest gains.
(Some of) the other markets are down a little bit, but I think the standout underperformer is Western Australia. I think there was actually no office transactions there over the quarter
“If you compare the first half of this year to the first half of last year, South Australia and Queensland are actually improved, in terms of transactions.” Speers says.
“Although the value of transactions in Queensland in the second quarter was lifted by the sale of Waterfront Place (for $592 million), sales were nevertheless quite strong and constituted a marked improvement on Q1, 2015.”
But it was a different story in Western Australia, which was unable to secure an office sale of more than $5 million for the entire quarter.
“(Some of) the other markets are down a little bit, but I think the standout underperformer is Western Australia. I think there was actually no office transactions there over the quarter,” Speers says.
“There’s probably more off-market (sales) than on-market, but we track transactions greater than $5 million and from what we can see there was none.”
Quarterly sales across Australia were down $300 million compared with the same period last year, with industrial properties dropping from $1.1 billion to $400 million. But retail and office sales improved by $200 million each – a 10 and seven per cent jump, respectively.
Article originally sourced from realcommercial.com.au