At the halfway point through 2014, investment volume stands at $14 billion, almost 30 per cent higher than the first half 2013 at $11 billion. ‘‘Competition between domestic and offshore investors for Australian commercial real estate assets continues to intensify," Mr Brown said. ‘‘Furthermore, the diversity of foreign investors continues to increase. Of the $9. 3 billion invested over the first quarter of 2014, almost $4 billion or 43 per cent came from offshore.
Senior director, international investments, CBRE Australia, Rick Butler, says there are already signs that these loosened restrictions are translating to increased activity and the expectation is that these funds will show significant interest in the Australian market. ‘‘Asian insurers will increase their investment in real estate by 58 per cent, from US$130 billion ($138 billion) to US$205 billion in 2018.
Takeovers, changes to investment regulations and demand for high yielding, ‘‘safe haven" bricks and mortar assets, attracted close to $10 billion of cash to the Australian commercial real estate sector, in the past few months, according to new data.
According to CBRE’s latest research report, "Liberalisation and the Rise of Asian Insurance Investment in Real Estate", regulations around insurance company investment have historically been tight in the Asia region, limiting the capital deployed into real estate assets.
The buying has been in direct assets across office towers, shopping malls and hotels as well as indirectly through real estate investment trusts, which offer a ‘‘safe haven’’, pseudo-bond market stability in a low interest rate environment.
Read more here: SMH