Abstract:
As there is limited information on the
size of the Australian property investment
market, it is often overlooked as
a significant consideration in major property
asset allocation strategies. To overcome this,
statistical models based on key economic determinants
and aggregated property data can
provide a good representation of the Australian
property investment market. In acknowledging
definition issues and property market
assumptions, the estimated December 2004
size of the Australian property investment market
on available data is AU$354 billion with the
institutions directly owning approximately
AU$116 billion of core (office, retail and industrial)
property and AU$8 billion of non-core
property.
In identifying the Australian property investment
market size and institutional coverage,
the challenge is to improve the level of quality
property market information. Further research
on measuring the Australian property investment
market could have significant practical
implications, both to facilitate non-core property
sector opportunities to form part of institutions property portfolios and ultimately to
improve the quality of commercial property
investment decisions. This will make the Australian
property investment market more attractive
as a competing asset class and appealing
to overseas institutional investors.
