Why invest in Australian Real Estate? The big picture

October 26, 2022


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In a global context, Australian real estate represents a compelling investment with strong economy, steady returns, liquidity, ESG enabled and a good set-up for future growth.

  • Strong economy. 13th largest global economy and resilient with 28 years of un-interrupted growth. Personal income (US$60,000) and corporate profitability are in the top quadrant. Economic stability from a diverse contribution by sectors – Mining, Professional Services, Education, Retail trade, Construction.
  • Steady returns. Real Estate has provided +9.5% pa return over the past decade, underpinned by stable property income. Gearing levels are low and Australia is one of the few countries with a AAA sovereign debt rating. 5th largest pension fund/superannuation market helps propel investment.
  • Liquidity premium. Commercial real estate is $900bn asset class and Residential $10tn. Commercial real estate debt is $360bn asset class. Australia ranks 6th highest on dollar value of real estate transactions. Australian real estate has 4% (and growing) weighting in MSCI index. 
  • ESG enabled. Australia ranked #1 in GRESB ranking for 2021. Females comprise 34% of Board seats. 70% of occupiers target 100% renewable electricity by 2025.
  • Growth set-up. 14% population growth to 2030, highest amongst leading economies. $160bn development pipeline that helps drive returns. Under-penetrated eCommerce and Alternatives.  <1% vacancy in select markets provides robust rent growth.