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Asian investment in Australia’s commercial property sector is continuing to rise, according to real estate group CBRE.
Visitors to CBRE’s annual market outlook breakfast heard that Australia remains popular with Asian investors despite increasingly intense competition for foreign capital.
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Prime office yields in Sydney and Melbourne are above 6 per cent, while they are less than 3 per cent in Tokyo, Hong Kong and Taipei, CBRE said.
More than $1.3 billion has been invested in Melbourne CBD and near fringe development sites in the past two years, predominantly by offshore Asian groups, according to CBRE.
However, Australia may become a less attractive investment destination as Asian markets stabilise and the US economy improves, attendees at the breakfast heard.
CBRE city sales director Mark Wizel said Asian buyers would broaden their focus from development sites to core property and passive investment opportunities.
“The market is going to move in the next two years and the game changer is likely to be the Chinese pension funds and major institutional investors,” he said.
