Foreign investors pile into local property market

Foreign companies continue to target the Australian property market, with Japanese housing developer Sekisui House finalising a deal to buy a 75% stake in a $190 million portfolio of landholdings Brisbane and Sydney owned by struggling developer Payce Consolidated.

Overseas investors are increasingly targeting the Australian market, capitalising on bargain prices as debt-laden Australian developers rush to offload parts of their portfolios. 

South African investors are leading the charge, with the country’s largest property trust Growthpoint announcing two days ago that it had done a $200 million deal to recapitalise the Orchard Industrial Property Fund.

Growthpoint’s chief executive, Norbert Sasse, has signalled his intention to look for more opportunities in Australia.

“The quality of [Orchard’s] portfolio and management provides an attractive platform through which Growthpoint will enter the Australian market as a long-term property investor.”

He expects to announce more acquisitions soon, and says the next six to 12 months will present ideal buying conditions.

Last month another South African investor, Kirsh Group, grabbed a 27.4% stake in Abacus Property Group, while the Oman Investment Fund pumped $31 million into Melbourne developer Becton.

London investment company Ascot Capital recently bought Wesfarmers House in Perth for $84.8 million, while Singaporean Philip Lim is believed to be the buyer of a $33 million office building in Melbourne’s Docklands precinct.

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