Commercial property market in recovery phase
Australian commercial property recorded a total return of 5.9 per cent for the year ending June 2010, presenting an improvement of almost 5 percentage points over the previous period, according to the PCA/IPD Australia Property Index for the June quarter.
IPD Australia and New Zealand managing director Dr Anthony De Francesco said the PCA/IPD Index release reaffirmed his previous view that commercial property markets are positioned in the recovery phase of the property investment cycle.
“Going forward, the recovery profile for returns is likely to be mild rather than sharp due to a combination of weaker macroeconomic activity and adverse capital market conditions,” he added.
The index also noted that the positive performance of retail, industrial and office sectors was driven by an improvement in capital returns, albeit still negative, reported at -0.6 per cent, -2.4 per cent and -2.5 per cent respectively.
Australia is performing relatively better than the majority of global property markets, including British, American and Japanese markets, according to the report.
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