Auckland, 28 February 2013 – There has been a significant uplift in the number and value of commercial property transactions over the past six months, according to the latest NZ Investment Transaction Monitor research published by CBRE.
The research, which measures the volume of transactions of over $5 million in value, shows that:
- Transaction volumes have jumped to the highest six-monthly levels since the peaks of the market at the end of 2007 – increasing to $1,632 million over 84 transactions, from just under $1bn and 49 transactions in the first half of 2012.
- Average transaction prices have risen to $19 million for the 2012 year, up 47% from $13.6 million in 2011.
- The office sector recorded the highest total value of sales above $5m, accounting for $530 million (33%) of the total.
- Listed Property Vehicles and Other Managed Funds were the most dynamic investor categories. Combined, they account for 38% of the volume of purchases, up from 24% in H1. While private purchasers remain ahead, their market share of total transaction volumes declined from 50% to 44% from H1 to H2.
- Mortgagee sales have fallen. There were no mortgagee in possession sales in the past six months, after reaching 18% of total sales volume in the first half of 2011.
- The largest transactions in terms of individual properties included the sale of the Westfield Downtown Centre in Auckland for $90 million to Precinct and the sale of The Warehouse distribution centre at 13 Bolderwood Place in Wiri to ACC for $89 million.
Zoltan Moricz, CBRE’s Senior Director of Research & Consulting, says: “These figures may be seen as an indication of the market judging current conditions as suitable for recovery.
Market conditions have been supportive of property investment. Low interest rates, better capitalised investors, freer funding channels, stabilising and improving occupier market fundamentals have all contributed to greater investor confidence and ability to purchase. At the same time there are investors who think the time is right to exit properties, for instance with Westfield being the largest vendor of properties in 2012 as it refocused its shopping centre portfolio.
“The above mix of conditions will prevail through 2013. Current indications on the sell side are that a number of larger properties and portfolios will come on the market and we expect that there will be investor appetite for most of these across a mix of offshore and on shore parties both institutional and private”.
“The leading factor in the market recovery is the Auckland region, with $1.5 billion of transactions taking place in the city although transaction volumes also increased in Wellington and Christchurch. One of the most significant areas of improvement is for properties priced $50 million and over. 15 such properties transacted in 2012 more than the previous three years combined.”
About CBRE
CBRE Group, Inc. (NYSE:CBG), a Fortune 500 and S&P 500 company headquartered in Los Angeles, is the world’s largest commercial real estate services and investment firm (in terms of 2012 revenue). The Company has approximately 37,000 employees (excluding affiliates), and serves real estate owners, investors and occupiers through more than 300 offices (excluding affiliates) worldwide. CBRE offers strategic advice and execution for property sales and leasing; corporate services; property, facilities and project management; mortgage banking; appraisal and valuation; development services; investment management; and research and consulting. Please visit our website at www.cbre.com.
