The Australian Investment Review is a series of research examining the previous financial years activity across the retail, office and industrial markets. Each review takes a look at the complete transaction activity along with particular case studies and our expert’s provide their outlook for the year ahead.
Improving retail trading figures have been a highlight of the past year for the retail industry, and this positive sentiment is also apparent in the retail investment market. A lack of supply and record levels of demand continue to shape the market, with quality assets readily sought by investors looking to place their capital in strong performing centres. This lack of stock, combined with a continuing appetite for retail assets, has driven yield compression for assets that have sold in the 2014/15 year.
Over the last financial year, we have witnessed the largest volumes of office investment in Australian history. Demand for quality office investments by both local and offshore groups continues to drive the market, with more than $15 billion worth of office stock changing hands over the year to June 2015¬ an impressive increase of $925 million on the previous financial year.
Investment in the industrial and logistics sector has scaled new heights in the last 12 months. A total of 266 industrial and logistics properties worth $6.45 billion changed hands over the 2014-15 financial year, a significant uplift from the $4.12 billion worth of transactions over the preceding financial year. Yield compression was recorded across Australia and in particular in Sydney, Melbourne and Brisbane, as competition for assets intensified.