Subprime Crisis Puts The Mockers On Investment
The Age
Wednesday April 16, 2008
INVESTORS scared by the subprime crisis have been reluctant to buy Australian office buildings since the start of the year, despite strong demand from tenants and record-low office vacancy rates, according to quarterly data.
Australian office markets monitored by Jones Lang LaSalle had the lowest aggregate vacancy rate in 20 years this quarter, at just 4.6%. Melbourne's vacancy rate was 3.5%, while Perth's was the lowest at just 0.1%.But there were no significant recorded sales, and yields - the income a building generates compared with its value - have dropped by 25 basis points, according to the agency's quarterly report."The investment market has been weighed down by global credit and rising domestic interest rates," said report author Jatin Chand. "Despite strong economic fundamentals and a reasonably healthy Australian economy, potential investors have been reluctant to buy in the quarter." -- NATALIE CRAIG
© 2008 The Age
