Welcome to Forza Capital’s first foray into the blog space. It is our intention to use this forum to keep our clients up to date with market trends, recent transactions and other information we think may be worthwhile sharing. This news feed will be updated on a fortnightly basis and it is our aim to keep the content concise but informative so that you get valuable insights that you can digest quickly.
In terms of market conditions, the overwhelming feedback is that quality transactions are light on the ground. There appears to be a slight easing in investors risk perception which has started to see equity slowly flowing back into the property assets. This shift, when combined with the huge influx of money from offshore Asian investors chasing both development sites and quality income producing assets, has meant that competition for certain assets has been fierce.
Recently Forza Capital went to Sydney and Brisbane on a research trip to assess new investment opportunities and determine what was happening within the investment sector in each market. Both capital cities are in different points of the cycle and facing different trends – Sydney has (like Melbourne) seen a large influx of offshore equity. Brisbane, in contrast, has seen a great deal of interstate equity (Victorian and NSW investors) flow into their market.
Recurrent feedback from clients was that there is surplus cash sitting on the sidelines waiting to be deployed. This cash balance is growing (reflecting poor retail sales and the growing savings and deposit rates) but investors are waiting for the right opportunities before deploying cash. Together with a reduction in household debt, this provides serious capacity for many investors and it will be interesting to see how this plays out over the coming years. Obviously some of this money is starting to filter its way back into the market but patience will be key to getting exposure to the right asset.