Commercial sales are still not back to where they were before the Global Financial Crisis, according to CB Richard Ellis’ latest market analysis.
While commercial property had a slightly better year in 2010, with direct transaction activity rising 8.2 per cent over 2009, the tally was still about 15 per cent below the long term average annual turnover, according to CBRE executive director, Kevin Stanley.
“Sales activity is still to fully recover from the shocks of the global financial crisis,” Mr Stanley said.
The biggest change in activity was in the industrial market with $1.45 billion transacted so far in 2010 - an impressive 39 per cent increase over the previous year.
“A number of large industrial portfolios changed hands during the year, with significant interest coming from overseas investors,” Mr Stanley said.
“This is the first time foreign investors have weighed so heavily into the industrial sector, attracted by the low point in the pricing cycle, as well as the recent improvements in the leasing of new property as the economy improves.”
Meanwhile, the office sector accounted for 49 per cent of all sales, which is “about average” for this sector, according to CBRE.
Mr Stanley said better-than-expected levels of employment in 2010 is pointing to much better total returns for office sales in the year ahead, “especially in Melbourne and Sydney.”
“So 2010 was good timing to gain exposure to this sector,” he said.