Australia’s property funds management industry has grown by 30 per cent, or $65 million, in funds under management since 2004, despite the number of funds available to investors remaining static in the last 12 months.
According to Property Investment Research’s (PIR) annual Australian Property Funds Industry Survey, assets under management now total almost $275 billion, from around 1.2 million investors.
In addition, the number of properties available has increased by 2,000 in the past year, due to funds increasing their exposure to industrial, international and childcare properties.
PIR head of client services John Nicoll said: “This indicates a very healthy sector in anyone’s terms and shows continuing support for property investment in this country, despite some negative sentiment surrounding contracting yields and an overvalued listed sector.”
Examining the funds of over 200 responsible entities in the marketplace, the research found that 10 fund managers continue to dominate the sector, controlling almost 60 per cent of all funds under management.
The Westfield Group continues to hold the number one ranking, with market share of almost 16 per cent, while this year Macquarie Bank has jumped to second place, from sixth in 2005.
Colonial First State Group holds third place, after slipping from its second place rank last year.
Listed property trusts (LPTs) continue to remain the most common investment vehicle, representing 50 per cent of the overall funds under management with over 3,000 properties.
There are currently 60 LPTs trading on the ASX, 14 of which have listed since 2004.
PIR also found that unlisted retail funds are growing at a much faster pace than syndicates. “This is primarily a result of the investor community calling for greater liquidity and diversification than syndicates offer.
“In the past year, we have also seen the emergence of hybrid funds … These funds appear popular with retail investors, as they generally offer greater liquidity and diversification than pure direct property trusts,” Nicoll said.
