Offshore investors push sales to $4b

Overseas investors snapped up twice as many commercial properties in New Zealand last year as they did the year before, new research shows.

About 42 per cent of sales in 2017 were completed by foreign buyers, mainly from Australia, Singapore and China. Their investments totalled $1.7 billion.

CBRE executive chairman Brent McGregor said the ‘‘significant uplift’’ in sales to overseas investors came off the back of two years of strong sales to private New Zealand investors and syndicators.

One of the biggest sales last year was the Majestic Centre in Wellington, which was bought by South African investor Investec for $123.2 million.

‘‘Unlike previous cycles, there is now a meaningful depth of foreign capital mandated for New Zealand investment,’’ McGregor said.

Of the $1.7b invested by foreign investors last year, $967m came from Asians, $408m from Australians, $265m from Americans, $31m from Europeans, and $85m from other international investors.

This, coupled with sales to New Zealand investors, pushed commercial property sales to $4b for the fourth year in a row. Office buildings made up close to half of the 2017 transactions; the balance was shared between retail, land, and industrial.

‘‘This level of activity reflects the competitive nature of alternative offshore markets, New Zealand’s stable economy, [and] strong property market fundamentals,’’ he said.

In the latest CBRE Asia-Pacific investor intentions survey, 92 per cent of respondents indicated their investment activity this year would be the same or greater compared with 2017.

The same respondents indicated they wanted to move away from the preferred markets of Shanghai, Sydney and Tokyo.

Total sales of New Zealand commercial property between 2014 and 2017 was $18.4b.

The biggest year of sales was in 2014, when almost $3.5b worth of commercial properties changed hands.