This article is from the Australian Property Journal archive
MACQUARIE Direct Property yesterday released findings from a financial adviser survey that found an overwhelming majority of advisors believe there will be increased interest in global direct property in 2007.
MDP’s general manager Richard Stacker said the results of the survey were a strong indicator of the growing sophistication of Australian retail investors and their awareness of the global property market.
Stacker said global direct property is without question becoming a mainstream fixture of the Australian investment landscape.
“This is being driven by demand for diversification as well as an outlook for strong total returns from global property markets,” Stacker added.
MDP’s flagship fund – the Macquarie Direct Property Fund – recently expanded its international portfolio to include direct investments in China, Hong Kong and Europe, making it one of the first vehicles to give Australian retail investors efficient access to wholesale global property funds normally only available to institutional investors.
“While we expect our local portfolio to continue to deliver strong returns, it is opportunities overseas that we believe will bring the best growth opportunities in the medium term. It is pleasing to see this message is now flowing through to the adviser community,” he said.
The adviser survey was conducted in February 2007 as part of a Macquarie Direct Property adviser roadshow in Sydney, Brisbane and Melbourne. More than 100 advisers participated in the survey, which aimed to gather feedback on Australians’ appetite for investing in global property.
While global property is already on most advisers’ agenda – 88.9% reported that they currently discuss global property opportunities with clients – the survey reinforced that many advisers now think global property should form a part of the average portfolio.
Almost half of advisers surveyed believe that all investors should consider global property – not just those in the high-net-worth category.
“This indicates that global property is now considered a mainstream investment and not just something for the high net worth investor or institutions,” Stacker said.
“As markets across Asia and Europe rapidly mature, opportunities are now opening up that provide access to markets previously unavailable to retail investors,” he said. “Global direct property diversifies risk across geography, property sub sectors, tenants, capital sources and currency, and provides a valuable new source of new growth and income for savvy investors.”
A summary of the survey findings included:
- 88.9% of advisers currently discuss opportunities to invest in global property markets with their clients.
- 51.4% of advisers are getting more inquiries from clients about global property investment opportunities compared to last year.
- 93.2% of advisers expect to see more clients interested in global property investments in 2007.
- Almost one in two advisers said any investor wanting a diversified portfolio should invest in global property in 2007.
- Almost one in two advisers believe that the June 30 super deadline is one contributing factor in influencing people’s decisions to invest more into (non-residential) property assets.
- When asked why people wanted to invest in global property assets – 34% of advisers said portfolio diversification was the key reason, followed by 28.3% who said people were attracted to the growth outlook for global property markets.
- When asked why people were reluctant to invest in global property (both REITs and direct) – 29.5% of advisers said the key impediment was not enough information/understanding of the market, followed by 21.9% who said people were worried about investing in unfamiliar/far away markets. 21% of advisers said people simply hadn’t had the right vehicles to easily invest through.
- Advisers were divided on who were the most likely candidates for global property opportunities: 27.3% said high net worth investors were more likely to invest in global property assets, while 21.2% nominated sophisticated investors who take a more active interest in their portfolio. 24.2% of advisers however said no particular type of person was more likely to invest in global property assets.
Australian Property Journal
