In 2016, Colliers International expects the growth in investment witnessed in 2015 will continue, however there will be different types of investors in the market compared to the previous cycle.
"In 2007, the most dominant purchasers were Australian institutions," John Marasco, Colliers International Managing Director of Capital Markets & Investment Services, said. "In the current cycle, these institutions are increasingly being funded by offshore groups who are looking to partner with them because of their expertise in Australian property.
"The dominant groups going offshore will continue to be Australian superannuation funds as they seek to diversify their investment into direct property. Australian investors spent approximately $5billion overseas in 2015. Finding the scale necessary in Australia is increasingly difficult and offshore markets provide a significant pool in which to invest.
"The majority of local investors continue to use debt to fund their expansion plans, although the level of debt is expected to remain low with most planning to use at least 50% equity. The low cost of debt is expected to continue, with most investors predicting no change to the cost of debt over the next 12 months."