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Cushman: Rebound in foreign RE investment in Australia

Foreign investment volumes in Australian real estate rebounded to a five-quarter high in the third quarter of 2016, according to Cushman & Wakefield’s quarterly report.

Foreign investment in Australian real estate has rebounded to a five-quarter high after a slow start this year, according to data published by the property consultancy Cushman & Wakefield.

In its third quarter investment report, Cushman & Wakefield said the total foreign investment in the country amounted to $4.9 billion, a significant jump from the $2 billion invested in the second quarter.

Calling it the strongest quarterly result since the third quarter last year, Cushman & Wakefield said foreign investment accounted for 55 percent of the quarterly total.

Among the Asia Pacific investors that dominated inbound investment volumes, the report highlighted Singapore and China-based entities as being the most active, accounting for $1.7 billion and $1.3 billion in investments respectively.

In another change from the previous quarter when larger-sized deals were recorded, the third quarter saw investment activity skew back to smaller sized deals where the average deal size was around $47 million.

The improvement in inbound investment volumes in the third quarter follows an “erratic investment market in 2016 with regard to the number of deals and average deal size”, according to the property consultancy.

“The investment market in 2016 has been interesting to observe insofar as while investors remain keen to acquire assets, lack of available stock has produced somewhat erratic quarter on quarter results… Investment volume in 2016 is currently matching that of this stage in 2015. However, for volume to remain flat by the year’s end, a further $9.5 billion of investment is required in Q4,” the report further added.

Total investment volumes, including international and domestic acquisitions, increased 32 percent on a quarter-on-quarter basis to $9 billion.