Home • PRRES Inc. Journal • Read the Journal

Modelling the Australian Property Investment Universe: A Preliminary Study

Author/s: David Higgins

Date Published: 1/01/2005

Published in: Volume 11 - 2005 Issue 3 (pages 268 - 281)

Abstract

The benefits of measuring the Australian property investment universe are highly significant. The information can provide the basis for property asset allocation, be a key measure of a nation's wealth and indicate property market opportunities for institutional investors. This research examined three property universe models, each measuring a different component of the Australian property investment market at a specific point of time. Linked together with overseas comparisons, these models provided an outline of the Australian property investment universe. As at December 2003, the Australian property investment universe is estimated to be approximately $332 billion, with a core property market (office, retail and industrial) of $154 billion. However, with institutions owning $104 billion of Australian properties (PIR 2003) and applying overseas research on comparing property investment markets to invested institutional property markets, the findings tended to support the suggested Australian property investment universe figures.

Download Full Article

Download the Full Article PDF

14445921.2005.11104187.pdf 14445921.2005.11104187.pdf (230kB)

Keywords

Asset Allocation - Commercial Property - Performance Analysis - Property Market Size

References

  • ABS, 2001, Census of Population and Housing: Census Data 2001, Australian Bureau of Statistics, Canberra.
  • ATO, 2003, Taxation Statistics 2000-01: A Summary of Taxation, Superannuation and Industry Benchmarks, Australian Taxation Office, Canberra.
  • Callender M & Key T, 1996, The Total Value of Commercial Property in the United Kingdom, RICS Cutting Edge Conference, London.
  • DB Real Estate, 2002, A Framework for International Real Estate Investment, Deutsche Bank, Sydney.
  • Gordon S & Kizer L, 2004, US CMBS Loan Performance: Impact of Seasoning, Leverage and Location on Probability of Default, Moody’s Investors Service, New York.
  • Henderson Global Investors, 2001, The Global Property Market Risk Premium, Henderson Global Investors, London.
  • Henderson Investors, 2000, The Case for Global Property Investment, Henderson Investors, London.
  • Higgins D & Vamvakoulias D, 2004, Pilot Study of Investment Grade Property: Parramatta Local Government Area, Unpublished, Property Council of Australia.
  • iPlatinum, 2003, Enterprising City Outcomes: Establishment of Baselines, Parramatta City Council, Sydney.
  • Liang Y & Gordon N, 2003, A Bird’s Eye View of Global Real Estate Markets, Prudential Real Estate Investors, New Jersey.
  • Liang Y & McIntosh W, 1999, Global Commercial Real Estate, Prudential Real Estate Investors, New Jersey.
  • McIntosh W, Witalis K & Whitaker W, 2004, Estimating the European Real Estate Universe, ERES Conference, Milan.
  • PricewaterhouseCoopers & Lend Lease, 1999, Emerging Trends in Real Estate 2000, PricewaterhouseCoopers & Lend Lease, New York.
  • Property Council of Australia, 2004a, Australian Office Database, Property Council of Australia, Sydney.
  • Property Council of Australia, 2004b, Australian Shopping Centre Database, Property Council of Australia, Sydney.
  • Property Council of Australia, 2004c, Investment Performance Index 2003, Property Council of Australia, Sydney.
  • PIR, 2003, Australian Property Fund Industry Survey, Property Investment Research, Melbourne.
  • Roulac S, 2003, Corporate-Owned Real Estate Represents a Substantial Investment Universe, Journal of Real Estate Portfolio Management, Vol.9 No. 2 p167-178.
  • Smith A, Hess R & Liang Y, 2004, Size-tiered Economic Geography: A New View of the US Real Estate Markets, Prudential Real Estate Investors, New Jersey.
  • Thompson R, 1997, Industrial Employment Densities, American Real Estate Society Conference, Sarasota.
  • Whitaker B, 2001, Why Should Investors Consider International Real Estate Investment?, Global Real Estate Perspective, AIG Global Real Estate Investment Corp, New York.