Local and offshore investors and owner-occupiers will continue to target Melbourne’s CBD as a key investment destination in 2016.
According to Daniel Wolman, Colliers International Director of Melbourne City Sales, record low interest rates, a soft Australian dollar and volatility in overseas Asian markets will continue to position Australian commercial property as a safe haven for investors and owner occupiers alike in the year ahead.
“The CBD market is showing no signs of slowing down this year (2016),” Mr Wolman said. “With the exception of Christmas Day, the phones haven’t stopped ringing. Buyers from all over Asia as well as locally are still looking to transact, even in what has traditionally been a quiet period in years gone by.
“Everyone is looking to plant their money in property and secure assets before property values increase any further.
“The market is as hot as we have ever seen it and savvy property owners are capitalising on the demand from investors to sell their assets while the Australian dollar is still cheap for offshore buyers and our interest rates remain at an all-time record low."
According to Colliers International’s Oliver Hay, there has been a “huge influx” of purchasers looking to put money in prime CBD property.
“With limited stock, competition will only increase,” Mr Hay said. “Properties in prime locations with secure tenants will be particularly sought after."
The first property to hit the market in 2015 will be a 12-storey office building in the heart of the CBD at 51 Queen Street, located between Flinders and Collins Streets.
The building is approximately 4,800sqm and brings in a healthy long term income of more than $1.1million from a diverse range of quality tenants. The building is scheduled to hit the market in February in a campaign being run by Mr Wolman, Oliver Hay and Matthew Stagg.
The vendor, a Malaysian investment arm, has appointed Colliers International’s Melbourne City Sales team to divest of several assets from their Australian portfolio to take advantage of the strong demand from buyers.
“We also expect strong demand for high quality strata investments to continue into 2016, driven by low interest rates and limited stock,” Chris Ling, Colliers International Executive – Melbourne City Sales, said.
51 Queen Street