Latest NewsInvestors Rate Australia among World's Top ThreeMonday, 22 August 2016

Australia, China and Japan have topped the list of the best countries for property investment in an annual survey of the investment intentions of the world's largest global real estate investors.

The choice of Australia among the top three investment destinations was a sharp contrast to the findings in last year's inaugural survey when Australia was not even mentioned.

The Investment Intentions Asia Survey 2009 was conducted by the Asian Real Estate Association with the European Association for Investors in Non-Listed Real Estate Vehicles and the Pension Real Estate Association.

Mr Robert Lie, AREA's co-director and managing director of Dutch property group Redevco, told The Australian he was not surprised by this year's finding on Australia: "A lot of investors are regularly getting on a plane to Australia this year.

"This was not the case a year ago."

Mr Lie said investor interest had been generated by Australia's falling property prices and the lower Australian dollar.

Until recently, investors were looking for growth and opportunistic investment in emerging markets. He added, however, that this year's survey showed investors wanted returns from core assets in developed markets.

About half of the investors and managers of fund-of-funds (funds that invest in other managed funds) surveyed rated Australia and Japan as "the most appealing in terms of performance prospects in Asia".

Forty-one per cent of respondents rated Australian office and Japanese office investment as their preferred choice.

Australian office and retail properties were viewed as "core assets".

The breakdown, however, identified different levels of optimism among institutional investors, funds managers and fund-of-funds managers.

The survey found that managers of fund-of-funds were more optimistic about Australia as a location than fund managers or investors.

Sixty-four per cent of fund-of-funds managers listed Australia as the preferred locations, compared with 58 per cent of investors and about 40 per cent of fund managers.

AREA's research manager, Clara Lie, said 73 large global investment houses such as Blackrock, Deka Immobilien Investment; LaSalle Investment Management and Morgan Stanley took part in the survey.

The respondents expected the market in Asia, including Australia, to recover next year, with some expecting to see signs of recovery starting this year.

The respondents had a target weighting of 13.4 per cent to direct property.

Fifty per cent of US respondents, compared with 30 per cent of European respondents surveyed, intend to increase their allocations in Asian unlisted real estate over the next one to two years.

The results of the survey were released during the REIT World 2009 in Singapore, an annual event that attracted the top decision-makers in property from around the world, including a large contingent from Australia.

 

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