Commercial Property: What Makes for a Balanced Office Market?

19 January, 2012 by Leave a Comment

EVERY capital city has both a CBD and suburban Office market. And as you can appreciate, keeping tabs on all the various suburban markets is almost an impossible task for most investors.

But generally speaking, the health (or otherwise) of the CBD Office markets within each capital city will provide you with a fairly good gauge of the overall Office scene around Australia.

Accordingly, this graph will provide you with a clear picture of what has occurred over the past 4 years.

As a rule of thumb, Office markets are said to the “in balance”, when their Vacancy Rate lies between 5% and 7%. [Read more…]

Filed Under: Economic Issues, Global Scene, Offices, Opportunities, Property Cycles, Stability Tagged With: , , , , , , , , , , , , , , , , , , ,

OK … What’s Going On?

7 July, 2011 by Leave a Comment

Last weekend in the Financial Review, Andrew Clark began his article (on page 52) with the words:

“Australians don’t know if they’re in the middle of a pause that refreshes or the dullness before the deluge.”

That about sums up the general feedback I am receiving at the moment, from clients and colleagues alike.

Clark felt this probably stems from a combination of …

  • a lack of Federal leadership,
  • declining retail turnover,
  • poor flow-on from the mining boom and
  • the spectre of financial defaults overseas.

Presumably, this was behind the RBA’s decision to keep the cash rate on hold until next month — pending more economic data in the coming weeks.

On the plus side …

The IMF predicts solid growth going forwardAccording to the IMF … in spite of all the recent turmoil, the outlook for global economic growth appears quite rosy moving into the new financial year. [Read more…]

Filed Under: Economic Issues, Global Scene, Interest Rates, Investment Opportunity, Opportunities, Property Cycles, Stability Tagged With: , , , , , , , ,

Interest Rate Rises …
Are they a Good Sign?

5 May, 2010 by Leave a Comment

The RBA’s decision on interest rates yesterday came about because of what’s happening here in Australia, rather than in Europe.

It has been made against the backdrop of our exporters having recently extracted massive price hikes for iron or in coal, as a result of China’s strong growth.

Since the global turmoil started in 2008, the $A has climbed by nearly 55% against the $US — and just over 40% against our other key trading partners.

RBA Logic

RBA Logic

This has more or less offset the rise in Australia’s local retail prices, through a sharp decline in the cost of imported items — like electrical goods, clothing, footwear and furniture.

As a result, the NAB’s business confidence index stands firmly positive for the third consecutive quarter. And even more importantly, actually improved throughout the last quarter.

h2. How will this affect Commercial Property?
[Read more…]

Filed Under: Economic Issues, Global Scene, Interest Rates, Investment Objectives, Investment Opportunity, Offices Tagged With: , , , , , , , , , , , ,

Biggest Economic Threat For Australia

13 January, 2010 by Leave a Comment

It might surprise you to hear this, however …

h3. A Strong US Recovery

… would probably be the worst thing to happen for Australia in 2010.

If that occurs, the US Federal Reserve would be forced to quickly raise interest rates, from zero to around 3%. And that would cause the collapse in the Australian dollar from its current level of around US90c.

Up until now, Australia has been shielded from inflationary pressures, with a high dollar holding down the cost of imports.
[Read more…]

Filed Under: Economic Issues, Global Scene, Industrial Sector, Interest Rates, Investment Opportunity, Offices, Property Cycles, Residential vs Commercial, Retail Sector, Your Exposure Tagged With: , , , , , , , , , , , , , , , , , , ,

State of the Commercial Market?

17 August, 2009 by Leave a Comment

CBD Office Vacancies

CBD Office Vacancies


As you would expect, the financial turmoil worldwide has had a significant effect on most property markets. However, the effect has not been the same across the board.

The current state of the various CBD office markets is probably your best barometer of future activity for two reasons. First, the Property Council of Australia (PCA) conducts six-monthly surveys to establish the CBD vacancy rates right around Australia.
[Read more…]

Filed Under: Economic Issues, Offices, Your Exposure Tagged With: , , , , , , , , , , , , , , , , , , , , , ,

Victoria is Starting to Shine

10 March, 2009 by Leave a Comment

Victoria may not have grown as fast as Queensland and WA over the whole of 2008.

December Quarter Growth Figures

December Quarter Growth Figures


However, it far outstripped every other State for the December — once the full impact of the global turmoil had started to take effect.

And as mentioned in an earlier posting … the positive impact of the Bush Fire Relief funds will certainly help to shore up Victoria’s position even further.

Filed Under: Economic Issues, Global Scene, Investment Objectives, Investment Opportunity, Mind Benders, Your Exposure Tagged With: ,

Which Australian Office Markets are in Trouble?

10 February, 2009 by Leave a Comment

Queensland seems to have been hardest hit. And in particular the Gold Coast, where vacancy levels have soared to around 18%.

But the difficulties confronting Queensland (and fellow mining State WA) are not necessarily reflected Australia-wide.
[Read more…]

Filed Under: Economic Issues, Global Scene, Offices Tagged With: , , , , , , , , , , , , , , , , , , , , , ,

Taking Stock of Commercial Property

3 February, 2009 by Leave a Comment

As I mentioned in a recent email to some Clients, it’s been surprising how few quality properties have been forced onto the market — given the difficulties caused by current global turmoil.

You’ve heard so much lately as to how bad things are. But let’s undertake a quick comparison for Australia — between 1990 and now.
[Read more…]

Filed Under: Global Scene, Interest Rates, Investment Opportunity, Offices, Property Cycles, Your Exposure Tagged With: , , , , , , , , , , , , , , , , , , ,