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Asia’s love affair with Australia may be cooling

Asia’s love affair with Australia may be cooling

by Staff Reporter 0 comments

Australia has been ranked as Asia-Pacific’s second most attractive real estate destination – behind China.

The Asia-Pacific Investor Intentions Survey, conducted by global real estate group CBRE, gauged the appetite and outlook of Asia-Pacific real estate investors for the rest of the year.

According to CBRE, 28 per cent of respondents rated China as the most attractive country for cross-border property investment, followed by Australia at 18 per cent.

The four most popular cities were Tokyo, Shanghai, Sydney and Melbourne.

Residential property was the third most popular sector in which to invest after the office sector and industrial and logistics.

CBRE’s Australian head of research, Stephen McNabb, said Australia remained an attractive investment destination but that foreign inflows could slow in 2014 due to increasing competition for global capital.

“We expect a slowing – not an exodus – in capital inflows. This is consistent with our view that demand for Australian dollar assets falls relative to improving growth stories globally, the outcome of which has been reflected in a lower Australian dollar over the past six months or so,” he said.

CBRE’s senior director of international investments, Michael Andrew, said foreign investors in Australia were broadening their interest beyond city centres.

“Australia is still witnessing very strong demand for core real estate across all sectors. However, we have seen the emergence of an appetite for assets in what has often been seen as secondary 'non-core' markets, where investors understand they can still get high quality assets, strong covenants and at better yields than in the CBDs,” he said.

Asia’s love affair with Australia may be cooling
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