Sydney and Melbourne are two of Australia’s hottest commercial hotspots. But, how did the East Coast capitals earn their titles, and what could be the next big destination?
Asian investors are helping to drive a commercial boom in Australia’s largest capitals. Sydney was the third most popular destination for Asian developers in the first half of 2015. With $2.5 billion worth of developments, only London and New York beat Sydney, according to a CBRE report. Melbourne is sixth place on the report, with $700 million worth of commercial investments.
The strong tourism trade of both of these cities helps explain the trend; just under half of the money spent by Asian buyers ($4.1 billion) went to Australian hotels. Offices were the next most popular type of Asian commercial investment, accounting for $1.4 billion nationally.
Notable Investments in Sydney and Melbourne
Sydney hotels accounted for both of 2015’s largest foreign purchases. The Westin Sydney sold for $445 million, while the Hilton Hotel Sydney sold for $442 million. The Hong-Kong based firm Euro Properties also secured the Channel Nine Studios site in the Sydney suburb of Willoughby for $147.5 million. It plans to use the land for a large-scale residential development with more than 400 homes.
In Melbourne, China’s Fu Wah International Group purchased the Park Hyatt Melbourne for $135 million, and Hong Kong’s Ovolo Group bought the Oaks on Lonsdale for $70 million. This was part of a $135 million deal, which also included two Sydney hotels.
Brisbane Poised for a Surge
While Sydney and Melbourne are currently performing well, strong investor growth in Brisbane could inspire a commercial boom in the Sunshine State’s capital. If you’re interested in launching a commercial construction project in Brisbane or another Queensland location, contact TPM Builders, one of Queensland’s most trusted names in construction.
As the Australian dollar continues to struggle against foreign currencies, we can expect more Asian investors to recognise the appeal of commercial property in Australia’s capitals.
Image via Flickr by Traveloscopy
