Sydney commercial property sales surge

Photo credit: 8LettersUK

Sales of commercial property in Sydney are surging, according to Savills.

The consultants’ latest report shows that transactions in the city’s Central Business District and North Shore office market have both soared in the year to September 2013. Indeed, CBD property sales totalled $2.6 billion, a rise of 139 per cent compared to the $1.1 billion invested in the previous 12 months. The North Shore market, meanwhile, has seen deals jump an even higher 170 per cent, from $421 million to $1.1 billion.

Funds and Trusts are driving the activity, accounted for over one-third of the stock in the CBD market. In the North Shore, Funds accounted for over half (53 per cent) of activity, while Trusts accounted for 12 per cent.

Foreign investors were active too, purchase $944 million in the two markets combined.

“The long awaited compression in prime yields has started to surface in the Sydney CBD office market,” explains Simon Hemphill, of Savills Research. “This combined with continued face rental growth has heralded the return of strong buyer appetite, both domestically and internationally. Indeed, the $2.6bn of transactions over the last 12 months is the second highest level of sales recorded in the last decade.”