Bushman
23-10-2008, 07:55 AM
Hi guys;
Time to start a thread here.
So we have seen the impact of the credit crunch on debt and equity markets. So what for Australia's office towers, factories and shopping centres?
We have seen a slight decrease in cap rates as valuer's take a conservative line while still being faced by 'robust' lease market. However the elephant in the room is:
1. the massive overhang of commercial property to be sold (think Centro, Allco, GPT etc). If the banks pull the plug, the market could be overwhelmed by a 'fire sale' and values will not hold up in the face of the excess supply;
2. what impact will 7-9% unemployment have on the sound 'lease' fundamentals?
3. credit, credit, credit. Property investment needs credit.
etc.
What do you guys think? Free fall or will the 'fundamentals' (remember how we used to talk about during equity markets discussions) win out?
Discuss...
Time to start a thread here.
So we have seen the impact of the credit crunch on debt and equity markets. So what for Australia's office towers, factories and shopping centres?
We have seen a slight decrease in cap rates as valuer's take a conservative line while still being faced by 'robust' lease market. However the elephant in the room is:
1. the massive overhang of commercial property to be sold (think Centro, Allco, GPT etc). If the banks pull the plug, the market could be overwhelmed by a 'fire sale' and values will not hold up in the face of the excess supply;
2. what impact will 7-9% unemployment have on the sound 'lease' fundamentals?
3. credit, credit, credit. Property investment needs credit.
etc.
What do you guys think? Free fall or will the 'fundamentals' (remember how we used to talk about during equity markets discussions) win out?
Discuss...