Welcome to this week’s Property News.
This is our 200th Weekly newsletter and just like our first, we continue to search the market for property news so that we can keep our clients & readers better informed so that they can make better decisions about property.
This week, a number of the REITs have issued their quarterly updates revealing more news and evidence of market conditions. It comes as no great surprise, that groups who have had exposure to the residential house & land market have seen a tremendous surge in demand from the Home Builder program (particularly from first home buyers). Stockland, particularly have been a beneficiary of this. We expect this surge in demand to be followed by a slow down as the market awaits the next surge, mostly likely when migration returns. The apartment market has been a late beneficiary with the housing price boom only just recently making its way into the apartment market (see Mirvac) with investors starting to see value in the market.
REITs exposed to the industrial market are continuing to bask in the glorious sun shine (Centuria, Dexus, Growthpoint) as tenant demand (GPT, Frasers, Logos) and capital demand continues to see values improve. Blackstone’s sale of their portfolio will see material changes in values for the June quarter.
CBD Office assets and Regional Shopping Centres are still in an early stage of recovery with tenant’s still facing an uncertain road back to normal for their staff and customers (GPT). Blackstone’s sale of Clifford Gardens and Rundle Place (both at a capital loss) demonstrates the challenge the sector has faced. Blackstone still have at least another 4 retail assets including Top Ryde, Forest Hill Chase, Greensborough Plaza, and Strathpine Centre which are all in the 40,000sqm – 70,000sqm size – putting them in the challenging position of being too big for convenience shopping and too small for experiential shopping.
All of this news continue to re-affirm our current investment philosophy.
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